EX-10.1






Exhibit 10.1




PURCHASE AGREEMENT




PURCHASE AGREEMENT (the “Agreement”), dated as of December 16, 2016, by and between
TRANSENTERIX, INC., a Delaware corporation, (the “Company”), and LINCOLN PARK CAPITAL FUND,
LLC, an Illinois limited liability company (the “Investor”).



WHEREAS:




Subject to the terms and conditions set forth in this Agreement, the Company wishes to sell to the
Investor, and the Investor wishes to purchase from the Company, up to Twenty-Five Million Dollars
($25,000,000) of the Company’s common stock, $0.001 par value (the “Common Stock”). The
shares of Common Stock to be purchased hereunder are referred to herein as the “Purchase
Shares.”



NOW THEREFORE, in consideration of the mutual covenants contained in this Agreement, and for other
good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the
Company and the Investor hereby agree as follows:



1. CERTAIN DEFINITIONS.



For purposes of this Agreement, the following terms shall have the following meanings:



(a) “Accelerated Purchase Share Amount” means, with respect to any Accelerated
Purchase made pursuant to Section 2(b) hereof, the number of Purchase Shares directed by the
Company to be purchased by the Investor on an Accelerated Purchase Notice, which number of Purchase
Shares shall not exceed the lesser of (i) 300% of the number of Purchase Shares directed by the
Company to be purchased by the Investor pursuant to the corresponding Regular Purchase Notice for
the corresponding Regular Purchase referred to in Section 2(b) hereof (subject to the Purchase
Share limitations contained in Section 2(a) hereof) and (ii) the Accelerated Purchase Share
Percentage multiplied by the trading volume of the Common Stock on the Principal Market during
normal trading hours on the Accelerated Purchase Date.



(b) “Accelerated Purchase Date” means, with respect to any Accelerated Purchase made
pursuant to Section 2(b) hereof, the Business Day immediately following the applicable Purchase
Date with respect to the corresponding Regular Purchase referred to in Section 2(b) hereof.



(c) “Accelerated Purchase Notice” means, with respect to any Accelerated Purchase made
pursuant to Section 2(b) hereof, an irrevocable written notice from the Company to the Investor
directing the Investor to buy a specified Accelerated Purchase Share Amount on the applicable
Accelerated Purchase Date pursuant to Section 2(b) hereof at the applicable Accelerated Purchase
Price.



(d) “Accelerated Purchase Share Percentage” means, with respect to any Accelerated
Purchase made pursuant to Section 2(b) hereof, thirty percent (30%).



(e) “Accelerated Purchase Price” means, with respect to any particular Accelerated
Purchase made pursuant to Section 2(b) hereof, the lower of: (i) ninety-seven percent (97%) of the
VWAP during the applicable of the following: (A) the entire trading day on the Accelerated Purchase
Date, if the volume of shares of Common Stock traded on the Principal Market on the Accelerated
Purchase Date has not exceeded the Accelerated Purchase Share Volume Maximum, or (B) the portion of
the trading day of the Accelerated Purchase Date (calculated starting at the beginning of normal
trading hours) until such time at which the volume of shares of Common Stock traded on the
Principal Market has exceeded the Accelerated Purchase Share Volume Maximum, if the volume of
shares of Common Stock traded on the Principal Market on the Accelerated Purchase Date has exceeded
the Accelerated Purchase Share Volume Maximum, or (ii) the Closing Sale Price on the Accelerated
Purchase Date (to be appropriately adjusted for any reorganization, recapitalization, non-cash
dividend, stock split, reverse stock split or other similar transaction).



(f) “Accelerated Purchase Share Volume Maximum” means the number of shares of Common
Stock traded on the Principal Market during normal trading hours on the Accelerated Purchase Date
equal to (i) the amount of shares of Common Stock properly directed by the Company to be purchased
on the Accelerated Purchase Notice, divided by (ii) the Accelerated Purchase Share Percentage (to
be appropriately adjusted for any reorganization, recapitalization, non-cash dividend, stock split,
reverse stock split or other similar transaction).



(g) “Available Amount” means initially Twenty-Five Million Dollars ($25,000,000) in
the aggregate, which amount shall be reduced by the Purchase Amount each time the Investor
purchases shares of Common Stock pursuant to Section 2 hereof.



(h) “Bankruptcy Law” means Title 11, U.S. Code, or any similar federal or state law
for the relief of debtors.



(i) “Base Prospectus” means the Company’s final base prospectus, dated June 22, 2016,
a preliminary form of which is included in the Registration Statement, including the documents
incorporated by reference therein, or any final base prospectus in any Registration Statement filed
after the date hereof to cover the sales of the Securities.



(j) “Business Day” means any day on which the Principal Market is open for trading,
including any day on which the Principal Market is open for trading for a period of time less than
the customary time.



(k) “Closing Sale Price” means, for any security as of any date, the last closing sale
price for such security on the Principal Market as reported by the Principal Market.



(l) “Confidential Information” means any information disclosed by either party to the
other party, either directly or indirectly, in writing, orally or by inspection of tangible objects
(including, without limitation, documents, prototypes, samples, plant and equipment), which is
designated as “Confidential,” “Proprietary” or some similar designation. Information communicated
orally shall be considered Confidential Information if such information is confirmed in writing as
being Confidential Information within ten (10) Business Days after the initial disclosure.
Confidential Information may also include information disclosed to a disclosing party by third
parties. Confidential Information shall not, however, include any information which (i) was
publicly known and made generally available in the public domain prior to the time of disclosure by
the disclosing party; (ii) becomes publicly known and made generally available after disclosure by
the disclosing party to the receiving party through no action or inaction of the receiving party;
(iii) is already in the possession of the receiving party at the time of disclosure by the
disclosing party as shown by the receiving party’s files and records immediately prior to the time
of disclosure; (iv) is obtained by the receiving party from a third party without a breach of such
third party’s obligations of confidentiality; or (v) is independently developed by the receiving
party without use of or reference to the disclosing party’s Confidential Information, as shown by
documents and other competent evidence in the receiving party’s possession.



(m) “Custodian” means any receiver, trustee, assignee, liquidator or similar official
under any Bankruptcy Law.



(n) “DTC” means The Depository Trust Company, or any successor performing
substantially the same function for the Company.



(o) “DWAC Shares” means shares of Common Stock that are (i) issued in electronic form,
(ii) freely tradable and transferable and without restriction on resale and (iii) timely credited
by the Company to the Investor’s or its designee’s specified Deposit/Withdrawal at Custodian (DWAC)
account with DTC under its Fast Automated Securities Transfer (FAST) Program or any similar program
hereafter adopted by DTC performing substantially the same function.



(p) “Exchange Act” means the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.



(q) “Initial Prospectus Supplement” means the prospectus supplement to the Base
Prospectus complying with Rule 424(b) under the Securities Act that is filed with the SEC and
delivered by the Company to the Investor upon the execution and delivery of this Agreement in
accordance with Section 5(a), including the documents incorporated by reference therein.



(r) “Material Adverse Effect” means any material adverse effect on (i) the
enforceability of any Transaction Document, (ii) the results of operations, assets, business or
financial condition of the Company and its Subsidiaries, taken as a whole, other than any material
adverse effect that resulted exclusively from (A) any change in the United States or foreign
economies or securities or financial markets in general that does not have a disproportionate
effect on the Company and its Subsidiaries, taken as a whole, (B) any change that generally affects
the industry in which the Company and its Subsidiaries operate that does not have a
disproportionate effect on the Company and its Subsidiaries, taken as a whole, (C) any change
arising in connection with earthquakes, hostilities, acts of war, sabotage or terrorism or military
actions or any escalation or material worsening of any such hostilities, acts of war, sabotage or
terrorism or military actions existing as of the date hereof, (D) any action taken by the Investor,
its affiliates or its or their successors and assigns with respect to the transactions contemplated
by this Agreement, (E) the effect of any change in applicable laws or accounting rules that does
not have a disproportionate effect on the Company and its Subsidiaries, taken as a whole, or
(F) any change resulting from compliance with terms of this Agreement or the consummation of the
transactions contemplated by this Agreement, or (iii) the Company’s ability to perform in any
material respect on a timely basis its obligations under any Transaction Document to be performed
as of the date of determination.



(s) “Maturity Date” means the first day of the month immediately following the
thirty-six (36) month anniversary of the Commencement Date.



(t) “Person” means an individual or entity including but not limited to any limited
liability company, a partnership, a joint venture, a corporation, a trust, an unincorporated
organization and a government or any department or agency thereof.



(u) “Principal Market” means the NYSE MKT (or any nationally recognized successor
thereto); provided, however, that in the event the Company’s Common Stock is ever listed or traded
on The NASDAQ Capital Market, The NASDAQ Global Market, The NASDAQ Global Select Market, the New
York Stock Exchange, the NYSE Arca, the OTC Bulletin Board, or the OTCQB or the OTCQX operated by
the OTC Markets Group, Inc. (or any nationally recognized successor to any of the foregoing), then
the “Principal Market” shall mean such other market or exchange on which the Company’s Common Stock
is then listed or traded.



(v) “Prospectus” means the Base Prospectus, as supplemented by any Prospectus
Supplement (including the Initial Prospectus Supplement), including the documents incorporated by
reference therein.



(w) “Prospectus Supplement” means any prospectus supplement to the Base Prospectus
(including the Initial Prospectus Supplement) filed with the SEC pursuant to Rule 424(b) under the
Securities Act in connection with the transactions contemplated by this Agreement, including the
documents incorporated by reference therein.



(x) “Purchase Amount” means, with respect to any Regular Purchase or any Accelerated
Purchase made hereunder, the portion of the Available Amount to be purchased by the Investor
pursuant to Section 2 hereof.



(y) “Purchase Date” means, with respect to any Regular Purchase made pursuant to
Section 2(a) hereof, the Business Day on which the Investor receives by 5:00 p.m., Eastern time, of
such Business Day a valid Regular Purchase Notice that the Investor is to buy Purchase Shares
pursuant to Section 2(a) hereof.



(z) “Purchase Price” means, with respect to any Regular Purchase made pursuant to
Section 2(a) hereof, the lower of: (i) the lowest Sale Price of the Common Stock on the applicable
Purchase Date and (ii) the arithmetic average of the three (3) lowest Closing Sale Prices for the
Common Stock during the ten (10) consecutive Business Days ending on the Business Day immediately
preceding such Purchase Date (in each case, to be appropriately adjusted for any reorganization,
recapitalization, non-cash dividend, stock split or other similar transaction).



(aa) “Registration Statement” means the effective registration statement on Form S-3
(Commission File No. 333-199998) filed by the Company with the SEC pursuant to the Securities Act
for the registration of shares of its Common Stock, including the Securities, and certain other
securities, as such Registration Statement has been or may be amended and supplemented from time to
time, including all documents filed as part thereof or incorporated by reference therein, and
including all information deemed to be a part thereof at the time of effectiveness pursuant to Rule
430B of the Securities Act, including any comparable successor registration statement filed by the
Company with the SEC pursuant to the Securities Act for the registration of shares of its Common
Stock, including the Securities.



(bb) “Regular Purchase Notice” means, with respect to any Regular Purchase pursuant to
Section 2(a) hereof, an irrevocable written notice from the Company to the Investor directing the
Investor to buy such applicable amount of Purchase Shares at the applicable Purchase Price as
specified by the Company therein on the Purchase Date.



(cc) “Sale Price” means any sale price for the shares of Common Stock on the Principal
Market as reported by the Principal Market.



	 	 	 
	(dd)

	 	“SEC” means the U.S. Securities and Exchange Commission.
	
 
	 	 
	(ee)

	 	“Securities” means, collectively, the Purchase Shares and the Commitment Shares.
	
 
	 	 






(ff) “Securities Act” means the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.



(gg) “Subsidiary” means any Person the Company wholly-owns or controls, or in which
the Company, directly or indirectly, owns a majority of the voting stock or similar voting
interest, in each case that would be disclosable pursuant to Item 601(b)(21) of Regulation S-K
promulgated under the Securities Act.



(hh) “Transaction Documents” means, collectively, this Agreement and the schedules and
exhibits hereto, and each of the other agreements, documents, certificates and instruments entered
into or furnished by the parties hereto in connection with the transactions contemplated hereby and
thereby.



(ii) “Transfer Agent” means Continental Stock & Transfer Company, or such other
Person who is then serving as the transfer agent for the Company in respect of the Common Stock.



(jj) “VWAP” means in respect of an applicable Accelerated Purchase Date, the volume
weighted average price of the Common Stock on the Principal Market, as reported on the Principal
Market.



2. PURCHASE OF COMMON STOCK.



Subject to the terms and conditions set forth in this Agreement, the Company has the right to
sell to the Investor, and the Investor has the obligation to purchase from the Company, Purchase
Shares as follows:



(a) Commencement of Regular Sales of Common Stock. Upon the satisfaction of the
conditions set forth in Sections 7 and 8 hereof (the “Commencement” and the date of
satisfaction of such conditions the “Commencement Date”) and thereafter, the Company shall
have the right, but not the obligation, to direct the Investor, by its delivery to the Investor of
a Regular Purchase Notice from time to time, to purchase up to One Hundred Fifty Thousand (150,000)
Purchase Shares (each such purchase a “Regular Purchase”), at the Purchase Price on the
Purchase Date; provided, however, that (i) the Regular Purchase may be increased to
up to Two Hundred Thousand (200,000) Purchase Shares, provided that the Closing Sale Price of the
Common Stock is not below $1.75 on the Purchase Date, (ii) the Regular Purchase may be increased to
up to Three Hundred Thousand (300,000) Purchase Shares, provided that the Closing Sale Price of the
Common Stock is not below $2.50 on the Purchase Date, (iii) the Regular Purchase may be increased
to up to Four Hundred Thousand (400,000) Purchase Shares, provided that the Closing Sale Price of
the Common Stock is not below $3.00 on the Purchase Date, and (iv) the Regular Purchase may be
increased to up to Five Hundred Thousand (500,000) Purchase Shares, provided that the Closing Sale
Price of the Common Stock is not below $4.00 on the Purchase Date (all of which amounts shall be
appropriately adjusted for any reorganization, recapitalization, non-cash dividend, stock split or
other similar transaction); and provided, further, that the Investor’s committed obligation under
any single Regular Purchase shall not exceed Two Million Dollars ($2,000,000), unless the parties
mutually agree to increase the dollar or share amount of any Regular Purchase on any Purchase Date
at the applicable Purchase Price. If the Company delivers any Regular Purchase Notice for a
Purchase Amount in excess of the limitations contained in the immediately preceding sentence, such
Regular Purchase Notice shall be void ab initio to the extent of the amount by which the number of
Purchase Shares set forth in such Regular Purchase Notice exceeds the number of Purchase Shares
which the Company is permitted to include in such Purchase Notice in accordance herewith, and the
Investor shall have no obligation to purchase such excess Purchase Shares in respect of such
Regular Purchase Notice; provided that the Investor shall remain obligated to purchase the number
of Purchase Shares which the Company is permitted to include in such Regular Purchase Notice. The
Company may deliver multiple Regular Purchase Notices to the Investor so long as at least one (1)
Business Day has passed since the most recent Regular Purchase was completed.



(b) Accelerated Purchases. Subject to the terms and conditions of this Agreement, in
addition to purchases of Purchase Shares as described in Section 2(a) above, the Company shall also
have the right, but not the obligation, to direct the Investor by the Company’s delivery to the
Investor of an Accelerated Purchase Notice from time to time, and the Investor thereupon shall have
the obligation, to buy Purchase Shares at the Accelerated Purchase Price on the Accelerated
Purchase Date in an amount equal to the Accelerated Purchase Share Amount (each such purchase, an
“Accelerated Purchase”). The Company may deliver an Accelerated Purchase Notice to the
Investor only on a Purchase Date on which the Closing Sale Price is not below $1.50 (to be
appropriately adjusted for any reorganization, recapitalization, non-cash dividend, stock split or
other similar transaction). If the Company delivers any Accelerated Purchase Notice for an
Accelerated Purchase Share Amount in excess of the limitations contained in the definition of
Accelerated Purchase Share Amount, such Accelerated Purchase Notice shall be void ab initio to the
extent of the amount by which the number of Purchase Shares set forth in such Accelerated Purchase
Notice exceeds the Accelerated Purchase Share Amount which the Company is permitted to include in
such Accelerated Purchase Notice in accordance herewith (which shall be confirmed in an Accelerated
Purchase Confirmation (defined below)), and the Investor shall have no obligation to purchase such
excess Purchase Shares in respect of such Accelerated Purchase Notice; provided that (i) the
Investor shall remain obligated to purchase the Accelerated Purchase Share Amount which the Company
is permitted to include in such Accelerated Purchase Notice and (ii) the parties may mutually agree
to increase the Accelerated Purchase Share Amount on any Accelerated Purchase Date at the
applicable Accelerated Purchase Price. Within one (1) Business Day after completion of each
Accelerated Purchase Date, the Accelerated Purchase Share Amount and the applicable Accelerated
Purchase Price shall be set forth on a confirmation of the Accelerated Purchase to be provided to
the Company by the Investor (an “Accelerated Purchase Confirmation”). The Company may
deliver multiple Accelerated Purchase Notices to the Investor, subject to and in accordance with
the provisions of this Section 2(b), so long as at least one (1) Business Day has passed since the
most recent Accelerated Purchase was completed.



(c)  Payment for Purchase Shares. For each Regular Purchase, the Investor shall pay
to the Company an amount equal to the Purchase Amount with respect to such Regular Purchase as full
payment for such Purchase Shares via wire transfer of immediately available funds on the same
Business Day that the Investor receives such Purchase Shares if such Purchase Shares are received
by the Investor before 1:00 p.m., Eastern time, or, if such Purchase Shares are received by the
Investor after 1:00 p.m., Eastern time, the next Business Day. For each Accelerated Purchase, the
Investor shall pay to the Company an amount equal to the Purchase Amount with respect to such
Accelerated Purchase as full payment for such Purchase Shares via wire transfer of immediately
available funds on the third Business Day following the date that the Investor receives such
Purchase Shares. If the Company or the Transfer Agent shall fail for any reason or for no reason
to electronically transfer any Purchase Shares as DWAC Shares in respect of a Regular Purchase or
Accelerated Purchase (as applicable) within three (3) Business Days following the receipt by the
Company of the Purchase Price or Accelerated Purchase Price, respectively, therefor in compliance
with this Section 2(c), and if on or after such Business Day the Investor purchases (in an open
market transaction or otherwise) shares of Common Stock to deliver in satisfaction of a sale by the
Investor of such Purchase Shares that the Investor anticipated receiving from the Company in
respect of such Regular Purchase or Accelerated Purchase (as applicable), then the Company shall,
in the Company’s discretion, within three (3) Business Days after the Investor’s request, either
(i) pay cash to the Investor in an amount equal to the Investor’s total purchase price (including
reasonable brokerage commissions, if any) for the shares of Common Stock so purchased (the
“Cover Price”), at which point the Company’s obligation to deliver such Purchase Shares as
DWAC Shares shall terminate, or (ii) promptly honor its obligation to deliver to the Investor such
Purchase Shares as DWAC Shares and pay cash to the Investor in an amount equal to the excess (if
any) of the Cover Price over the total Purchase Price for such Regular Purchase plus the Cover
Price over the total Accelerated Purchase Price for such Accelerated Purchase (as applicable). The
Company shall not issue any fraction of a share of Common Stock upon any Regular Purchase or
Accelerated Purchase. If the issuance would result in the issuance of a fraction of a share of
Common Stock, the Company shall round such fraction of a share of Common Stock up or down to the
nearest whole share. All payments made under this Agreement shall be made in lawful money of the
United States of America or wire transfer of immediately available funds to such account as the
Company may from time to time designate by written notice in accordance with the provisions of this
Agreement. Whenever any amount expressed to be due by the terms of this Agreement is due on any day
that is not a Business Day, the same shall instead be due on the next succeeding day that is a
Business Day.



(d) Purchase Price Floor. The Company and the Investor shall not effect any Regular
Purchase under this Agreement on any Purchase Date that the Closing Sale Price is less than the
Floor Price. “Floor Price” means $1.00, which shall be appropriately adjusted for any
reorganization, recapitalization, non-cash dividend, stock split or other similar transaction and,
effective upon the consummation of any such reorganization, recapitalization, non-cash dividend,
stock split or other similar transaction, the Floor Price shall mean the lower of (i) the
adjusted price and (ii) $1.00.



(e) Compliance with Rules of Principal Market.



(i) Exchange Cap. Subject to Section 2(e)(ii) below, the Company shall not issue or
sell any shares of Common Stock pursuant to this Agreement, and the Investor shall not purchase or
acquire any shares of Common Stock pursuant to this Agreement, to the extent that after giving
effect thereto, the aggregate number of shares of Common Stock that would be issued pursuant to
this Agreement and the transactions contemplated hereby would exceed 23,010,698 shares of Common
Stock (which number of shares shall be reduced, on a share-for-share basis, by the number of shares
of Common Stock issued or issuable pursuant to any transaction or series of transactions that may
be aggregated with the transactions contemplated by this Agreement under applicable rules of the
NYSE MKT or any other Principal Market on which the Common Stock may be listed or quoted) (the
“Exchange Cap”), unless and until the Company elects to solicit stockholder approval of the
issuance of Common Stock as contemplated by this Agreement and the stockholders of the Company have
in fact approved such issuance in accordance with the applicable rules and regulations of the NYSE
MKT, any other Principal Market on which the Common Stock may be listed or quoted, and the
Certificate of Incorporation and Bylaws of the Company. For the avoidance of doubt, the Company
may, but shall be under no obligation to, request its stockholders to approve the issuance of
Common Stock as contemplated by this Agreement; provided, that if stockholder approval is not
obtained in accordance with this Section 2(e)(i), the Exchange Cap shall be applicable for all
purposes of this Agreement and the transactions contemplated hereby at all times during the term of
this Agreement (except as set forth in Section 2(e)(ii) below).



(ii) At-Market Transaction. Notwithstanding Section 2(e)(i) above and subject to the
prior approval of the NYSE MKT or any other Principal Market on which the Common Stock may be
listed or quoted (to the extent required), the Exchange Cap shall not be applicable for any
purposes of this Agreement and the transactions contemplated hereby, solely to the extent that the
issuances and sales of Common Stock pursuant to this Agreement are deemed to be at a price equal to
or in excess of the greater of book or market value of the Common Stock as calculated in accordance
with the applicable rules of the NYSE MKT or any other Principal Market on which the Common Stock
may be listed or quoted (it being hereby acknowledged and agreed that the Exchange Cap shall be
applicable for all purposes of this Agreement and the transactions contemplated hereby at all other
times during the term of this Agreement, unless the stockholder approval referred to in Section
2(e)(i) is obtained).



(iii) General. The Company shall not issue any shares of Common Stock pursuant to
this Agreement if such issuance would reasonably be expected to result in (A) a violation of the
Securities Act or (B) a breach of the rules and regulations of the NYSE MKT or any other Principal
Market on which the Common Stock may be listed or quoted. The provisions of this Section
2(e) shall be implemented in a manner otherwise than in strict conformity with the terms hereof
only if necessary to ensure compliance with the Securities Act and the rules and regulations of the
NYSE MKT or any other Principal Market on which the Common Stock may be listed or quoted.



(f) Beneficial Ownership Limitation. Notwithstanding anything to the contrary
contained in this Agreement, the Company shall not issue or sell, and the Investor shall
not purchase or acquire, any shares of Common Stock under this Agreement which, when aggregated
with all other shares of Common Stock then beneficially owned by the Investor and its affiliates
(as calculated pursuant to Section 13(d) of the Exchange Act and Rule 13d-3 promulgated thereunder)
would result in the beneficial ownership by the Investor and its affiliates of more than 9.99% of
the then issued and outstanding shares of Common Stock (the “Beneficial Ownership
Limitation”). Upon the written or oral request of the Investor, the Company shall promptly (but
not later than one (1) Business Day) confirm orally or in writing to the Investor the number of
shares of Common Stock then outstanding. The Investor and the Company shall each cooperate in good
faith in the determinations required hereby and the application hereof. The Investor’s written
certification to the Company of the applicability of the Beneficial Ownership Limitation, and the
resulting effect thereof hereunder at any time, shall be conclusive with respect to the
applicability thereof and such result absent manifest error.



3. INVESTOR’S REPRESENTATIONS AND WARRANTIES.



The Investor represents and warrants to the Company that as of the date hereof and as of the
Commencement Date:



(a) Accredited Investor Status. The Investor is an “accredited investor” as that term
is defined in Rule 501(a)(3) of Regulation D promulgated under the Securities Act.



(b) Information. The Investor understands that its investment in the Securities
involves a high degree of risk. The Investor (i) is able to bear the economic risk of an
investment in the Securities including a total loss thereof, (ii) has such knowledge and experience
in financial and business matters that it is capable of evaluating the merits and risks of the
proposed investment in the Securities and (iii) has had an opportunity to ask questions of and
receive answers from the officers of the Company concerning the financial condition and business of
the Company and others matters related to an investment in the Securities. Neither such inquiries
nor any other due diligence investigations conducted by the Investor or its representatives shall
modify, amend or affect the Investor’s right to rely on the Company’s representations and
warranties contained in Section 4 below. The Investor has sought such accounting, legal and tax
advice as it has considered necessary to make an informed investment decision with respect to its
acquisition of the Securities. The Investor acknowledges and agrees that neither the Company nor
any of its Subsidiaries makes or has made any representations or warranties with respect to the
transactions contemplated hereby, other than those specifically set forth in Section 4 hereof.



(c) No Governmental Review. The Investor understands that no U.S. federal or state
agency or any other government or governmental agency has passed on or made any recommendation or
endorsement of the Securities or the fairness or suitability of an investment in the Securities nor
have such authorities passed upon or endorsed the merits of the offering of the Securities.



(d) Validity; Enforcement. This Agreement has been duly and validly authorized,
executed and delivered on behalf of the Investor and is a valid and binding agreement of the
Investor enforceable against the Investor in accordance with its terms, subject as to
enforceability to general principles of equity and to applicable bankruptcy, insolvency,
reorganization, moratorium, liquidation and other similar laws relating to, or affecting generally,
the enforcement of applicable creditors’ rights and remedies.



(e) Residency. The Investor is a resident of the State of Illinois.



(f) Certain Transactions and Confidentiality.  Other than consummating the
transactions contemplated hereunder, Investor has not, nor has any Person acting on behalf of or
pursuant to any understanding with Investor, directly or indirectly executed any purchases or
sales, including Short Sales, of the securities of the Company during the period commencing as of
the time that Investor first received a term sheet (written or oral) as of the Company or any other
Person representing the Company setting forth the material terms of the transactions contemplated
hereunder and ending immediately prior to the execution hereof.  Other than to other Persons party
to this Agreement, Investor has maintained the confidentiality of all disclosures made to it in
connection with this transaction (including the existence and terms of this transaction). 



(g) No Short Selling. The Investor represents and warrants to the Company that at no
time prior to the date of this Agreement has any of the Investor, its agents, representatives or
affiliates engaged in or effected, in any manner whatsoever, directly or indirectly, any (i) “short
sale” (as such term is defined in Rule 200 of Regulation SHO of the Exchange Act) of the Common
Stock or (ii) hedging transaction, which establishes a net short position with respect to the
Common Stock.



4. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.



The Company represents and warrants to the Investor that as of the date hereof and as of the
Commencement Date:



(a) Organization and Qualification. The Company and each of the Subsidiaries is an
entity duly incorporated or otherwise organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation or organization, with the requisite corporate power
and authority to own and use its properties and assets and to carry on its business as currently
conducted.  Neither the Company nor any Subsidiary is in violation or default of any of the
provisions of its respective certificate or articles of formation or incorporation, bylaws or other
organizational or charter documents, except as would not reasonably be expected to have a Material
Adverse Effect.  Each of the Company and the Subsidiaries is duly qualified to conduct business and
is in good standing as a foreign corporation or other entity in each jurisdiction in which the
nature of the business conducted or property owned by it makes such qualification necessary, except
where the failure to be so qualified or in good standing, as the case may be, would not reasonably
be expected to result in a Material Adverse Effect, and no proceeding has been instituted in any
such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail such
power and authority or qualification. The Company has no Subsidiaries except as set forth on
Schedule 4(a).



(b) Authorization; Enforcement; Validity. (i) The Company has the requisite corporate
power and authority to enter into and perform its obligations under this Agreement and each of the
other Transaction Documents, and to issue the Securities in accordance with the terms hereof and
thereof, (ii) the execution and delivery of the Transaction Documents by the Company and the
consummation by it of the transactions contemplated hereby and thereby, including without
limitation, the issuance of the Initial Commitment Shares (as defined below in Section 5(e)) and
the reservation for issuance and the issuance of the Additional Commitment Shares (as defined below
in Section 5(e)) and the Purchase Shares issuable under this Agreement, have been duly authorized
by the Company’s Board of Directors and no further consent or authorization is required by the
Company, its Board of Directors or its stockholders (save to the extent provided in this
Agreement), (iii) this Agreement has been, and each other Transaction Document shall be on the
Commencement Date, duly executed and delivered by the Company and (iv) this Agreement constitutes,
and each other Transaction Document upon its execution on behalf of the Company, shall constitute,
the valid and binding obligations of the Company enforceable against the Company in accordance with
their terms, except as such enforceability may be limited by general principles of equity or
applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws relating
to, or affecting generally, the enforcement of creditors’ rights and remedies. The Board of
Directors of the Company has approved the resolutions (the “Signing Resolutions”)
substantially in the form as set forth as Exhibit C attached hereto to authorize this
Agreement and the transactions contemplated hereby. The Signing Resolutions are valid, in full
force and effect and have not been modified or supplemented in any respect. The Company has
delivered to the Investor a true and correct copy of the written consent of the Board of Directors
of the Company adopting the Signing Resolutions. Except as set forth in this Agreement, no other
approvals or consents of the Company’s Board of Directors and/or stockholders is necessary under
applicable laws and the Company’s Certificate of Incorporation and/or Bylaws to authorize the
execution and delivery of this Agreement or any of the transactions contemplated hereby, including,
but not limited to, the issuance of the Commitment Shares (as defined below in Section 5(e)) and
the issuance of the Purchase Shares.



(c) Capitalization. As of the date hereof, the authorized capital stock of the
Company is set forth in the SEC Documents (as defined below). Except as disclosed in the
Registration Statement or the SEC Documents, (i) no shares of the Company’s capital stock are
subject to preemptive rights or any other similar rights or any liens or encumbrances suffered or
permitted by the Company, (ii) there are no outstanding debt securities, (iii) there are no
outstanding options, warrants, scrip, rights to subscribe to, calls or commitments of any character
whatsoever relating to, or securities or rights convertible into, any shares of capital stock of
the Company or any of its Subsidiaries, or contracts, commitments, understandings or arrangements
by which the Company or any of its Subsidiaries is or may become bound to issue additional shares
of capital stock of the Company or any of its Subsidiaries or options, warrants, scrip, rights to
subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights
convertible into, any shares of capital stock of the Company or any of its Subsidiaries, (iv) there
are no agreements or arrangements under which the Company or any of its Subsidiaries is obligated
to register the sale of any of their securities under the Securities Act, (v) there are no
outstanding securities or instruments of the Company or any of its Subsidiaries which contain any
redemption or similar provisions, and there are no contracts, commitments, understandings or
arrangements by which the Company or any of its Subsidiaries is or may become bound to redeem a
security of the Company or any of its Subsidiaries, (vi) there are no securities or instruments
containing anti-dilution or similar provisions that will be triggered by the issuance of the
Securities as described in this Agreement and (vii) the Company does not have any stock
appreciation rights or “phantom stock” plans or agreements or any similar plan or agreement. True
and correct copies of the Company’s Certificate of Incorporation, as amended and as in effect on
the date hereof (the “Certificate of Incorporation”), and the Company’s Bylaws, as amended
and as in effect on the date hereof (the “Bylaws”), and summaries of the terms of all
securities convertible into or exercisable for Common Stock, if any, and copies of any documents
containing the material rights of the holders thereof in respect thereto are part of the SEC
Documents.



(d) Issuance of Securities. Upon issuance and payment thereof in accordance with the
terms and conditions of this Agreement, the Purchase Shares shall be validly issued, fully paid and
nonassessable and free from all taxes, liens, charges, restrictions, rights of first refusal and
preemptive rights with respect to the issue thereof, with the holders being entitled to all rights
accorded to a holder of Common Stock. Up to 22,545,726 shares of Common Stock have been duly
authorized and reserved for issuance upon purchase under this Agreement as Purchase Shares. The
Commitment Shares have been duly authorized and, upon issuance in accordance with the terms of this
Agreement, shall be validly issued, fully paid and nonassessable and free from all taxes, liens,
charges, restrictions, rights of first refusal and preemptive rights with respect to the issue
thereof, with the holders being entitled to all rights accorded to a holder of Common Stock.
154,991 shares of Common Stock (subject to equitable adjustment for any reorganization,
recapitalization, non-cash dividend, stock split or other similar transaction) have been duly
authorized and reserved for issuance as Additional Commitment Shares in accordance with this
Agreement. The issuance of the Securities has been registered under the Securities Act by the
Company pursuant to the Registration Statement. Upon receipt of the Purchase Shares and the
Commitment Shares, the Investor will have good and marketable title to such Securities and such
Securities will be immediately freely tradable on the Principal Market.



(e) No Conflicts. The execution, delivery and performance of the Transaction
Documents by the Company and the consummation by the Company of the transactions contemplated
hereby and thereby (including, without limitation, the issuance of the Initial Commitment Shares
and the reservation for issuance and issuance of the Purchase Shares and the Additional Commitment
Shares) will not (i) result in a violation of the Certificate of Incorporation, any Certificate of
Designations, Preferences and Rights of any outstanding series of preferred stock of the Company or
the Bylaws or (ii) conflict with, or constitute a default (or an event which with notice or lapse
of time or both would become a default) under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the
Company is a party, or result in a violation of any law, rule, regulation, order, judgment or
decree (including federal and state securities laws and regulations and the rules and regulations
of the Principal Market applicable to the Company) or by which any property or asset of the Company
or any of its Subsidiaries is bound or affected, except in the case of conflicts, defaults,
terminations, amendments, accelerations, cancellations and violations under clause (ii), which
would not reasonably be expected to result in a Material Adverse Effect. Neither the Company nor
any of its Subsidiaries is in violation of any term of or is in default under any material
contract, agreement, mortgage, indebtedness, indenture, instrument, judgment, decree or order or
any statute, rule or regulation applicable to the Company or its Subsidiaries, except for possible
conflicts, defaults, terminations or amendments which could not reasonably be expected to have a
Material Adverse Effect. The business of the Company and its Subsidiaries is not being conducted,
and shall not be conducted, in violation of any law, ordinance, regulation of any governmental
entity, except for possible violations, the sanctions for which either individually or in the
aggregate could not reasonably be expected to have a Material Adverse Effect. Except as
specifically contemplated by this Agreement and as required under the Securities Act or applicable
state securities laws and the rules and regulations of the Principal Market and under the Corporate
Financing Rule 5110 of the FINRA, the Company is not required to obtain any consent, authorization
or order of, or make any filing or registration with, any court or governmental agency or any
regulatory or self-regulatory agency in order for it to execute, deliver or perform any of its
obligations under or contemplated by the Transaction Documents in accordance with the terms hereof
or thereof. Except as set forth elsewhere in this agreement, all consents, authorizations, orders,
filings and registrations which the Company is required to obtain pursuant to the preceding
sentence shall be obtained or effected on or prior to the Commencement Date. Since one year prior
to the date hereof, the Company has not received nor delivered any notices or correspondence from
or to the Principal Market. The Principal Market has not commenced any delisting proceedings
against the Company.



(f) SEC Documents; Financial Statements. The Company has filed all reports, schedules,
forms, statements and other documents required to be filed by the Company under the Securities Act
and the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for the twelve months
preceding the date hereof (or such shorter period as the Company was required by law or regulation
to file such material) (the foregoing materials, including the exhibits thereto and documents
incorporated by reference therein, being collectively referred to herein as the “SEC
Documents”) on a timely basis or has received a valid extension of such time of filing and has
filed any such SEC Documents prior to the expiration of any such extension.  As of their respective
dates and to the Company’s knowledge, the SEC Documents complied in all material respects with the
requirements of the Securities Act and the Exchange Act, as applicable. None of the SEC
Documents, when filed, contained any untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading. The financial
statements of the Company included in the SEC Documents comply in all material respects with
applicable accounting requirements and the rules and regulations of the SEC with respect thereto as
in effect at the time of filing.  Such financial statements have been prepared in accordance with
United States generally accepted accounting principles applied on a consistent basis during the
periods involved (“GAAP”), except as may be otherwise specified in such financial
statements or the notes thereto and except that unaudited financial statements may not contain all
footnotes required by GAAP, and fairly present in all material respects the financial position of
the Company and its consolidated Subsidiaries as of and for the dates thereof and the results of
operations and cash flows for the periods then ended, subject, in the case of unaudited statements,
to normal, immaterial, year-end audit adjustments. Except as publicly available through the SEC’s
Electronic Data Gathering, Analysis, and Retrieval system (EDGAR) or in connection with a
confidential treatment request submitted to the SEC, the Company has received no notices or
correspondence from the SEC for the one year preceding the date hereof other than SEC comment
letters relating to the Company’s filings under the Exchange Act and the Securities Act. There are
no “open” SEC comments. To the Company’s knowledge, the SEC has not commenced any enforcement
proceedings against the Company or any of its Subsidiaries.



(g) Absence of Certain Changes. Since December 31, 2015, except as disclosed in the
Registration Statement or the SEC Documents, there has been no material adverse change in the
business, properties, operations, financial condition or results of operations of the Company or
its Subsidiaries. The Company has not taken any steps, and does not currently expect to take any
steps, to seek protection pursuant to any Bankruptcy Law nor does the Company or any of its
Subsidiaries have any knowledge or reason to believe that its creditors intend to initiate
involuntary bankruptcy or insolvency proceedings. The Company is financially solvent and is
generally able to pay its debts as they become due.



(h) Absence of Litigation. Except as disclosed in the Registration Statement or the
SEC Documents, there is no action, suit, proceeding, inquiry or investigation before or by any
court, public board, government agency, self-regulatory organization or body pending or, to the
knowledge of the Company or any of its Subsidiaries, threatened against or affecting the Company,
the Common Stock or any of the Company’s Subsidiaries or any of the Company’s or the Company’s
Subsidiaries’ officers or directors in their capacities as such, which would reasonably be expected
to have a Material Adverse Effect.



(i) Acknowledgment Regarding Investor’s Status. The Company acknowledges and agrees
that the Investor is acting solely in the capacity of arm’s length purchaser with respect to the
Transaction Documents and the transactions contemplated hereby and thereby. The Company further
acknowledges that the Investor is not acting as a financial advisor or fiduciary of the Company (or
in any similar capacity) with respect to the Transaction Documents and the transactions
contemplated hereby and thereby and any advice given by the Investor or any of its representatives
or agents in connection with the Transaction Documents and the transactions contemplated hereby and
thereby is merely incidental to the Investor’s purchase of the Securities. The Company further
represents to the Investor that the Company’s decision to enter into the Transaction Documents has
been based solely on the independent evaluation by the Company and its representatives and
advisors.



(j) No Integrated Offering. Neither the Company, nor any of its affiliates, nor any
Person acting on its or their behalf has, directly or indirectly, made any offers or sales of any
security or solicited any offers to buy any security, under circumstances that would cause this
offering of the Securities to be integrated with prior offerings by the Company in a manner that
would require stockholder approval pursuant to the rules of the Principal Market on which any of
the securities of the Company are listed or designated. The issuance and sale of the Securities
hereunder does not contravene the rules and regulations of the Principal Market.



(k) Intellectual Property Rights. Except as disclosed in the Registration Statement
or the SEC Documents, the Company and its Subsidiaries own or possess adequate rights or licenses
to use all material trademarks, trade names, service marks, service mark registrations, service
names, patents, patent rights, copyrights, inventions, licenses, approvals, governmental
authorizations, trade secrets and rights necessary to conduct their respective businesses as now
conducted. None of the Company’s material trademarks, trade names, service marks, service mark
registrations, service names, patents, patent rights, copyrights, inventions, licenses, approvals,
government authorizations, trade secrets or other intellectual property rights have expired or
terminated, or, by the terms and conditions thereof, could expire or terminate within two years
from the date of this Agreement, except as would not reasonably be expected to have a Material
Adverse Effect. The Company and its Subsidiaries do not have any knowledge of any infringement by
the Company or its Subsidiaries of any material trademark, trade name rights, patents, patent
rights, copyrights, inventions, licenses, service names, service marks, service mark registrations,
trade secret or other similar rights of others, or of any such development of similar or identical
trade secrets or technical information by others and there is no claim, action or proceeding being
made or brought against, or to the Company’s knowledge, being threatened against, the Company or
its Subsidiaries regarding trademark, trade name, patents, patent rights, invention, copyright,
license, service names, service marks, service mark registrations, trade secret or other
infringement, which would reasonably be expected to have a Material Adverse Effect.



(l) Environmental Laws. Except as disclosed in the Registration Statement or the SEC
Documents, the Company and its Subsidiaries (i) are in compliance with any and all applicable
foreign, federal, state and local laws and regulations relating to the protection of human health
and safety, the environment or hazardous or toxic substances or wastes, pollutants or contaminants
(“Environmental Laws”), (ii) have received all permits, licenses or other approvals
required of them under applicable Environmental Laws to conduct their respective businesses and
(iii) are in compliance with all terms and conditions of any such permit, license or approval,
except where, in each of the three foregoing clauses, the failure to so comply could not reasonably
be expected to have, individually or in the aggregate, a Material Adverse Effect.



(m) Title. Except as disclosed in the Registration Statement or the SEC Documents,
the Company and the Subsidiaries have good and marketable title in fee simple to all real property
owned by them and good and marketable title in all personal property owned by them that is material
to the business of the Company and the Subsidiaries, in each case free and clear of all liens,
encumbrances and defects (“Liens”) and, except for Liens as do not materially affect the
value of such property and do not materially interfere with the use made and proposed to be made of
such property by the Company and the Subsidiaries and Liens for the payment of federal, state or
other taxes, the payment of which is neither delinquent nor subject to penalties.  Any real
property and facilities held under lease by the Company and the Subsidiaries are held by them under
valid, subsisting and enforceable leases with which the Company and the Subsidiaries are in
compliance with such exceptions as are not material and do not interfere with the use made and
proposed to be made of such property and buildings by the Company and its Subsidiaries.



(n) Insurance. The Company and each of its Subsidiaries are insured by insurers of
recognized financial responsibility against such losses and risks and in such amounts as management
of the Company believes to be prudent and customary in the businesses in which the Company and its
Subsidiaries are engaged. Neither the Company nor any such Subsidiary has been refused any
insurance coverage sought or applied for and neither the Company nor any such Subsidiary has any
reason to believe that it will not be able to renew its existing insurance coverage as and when
such coverage expires or to obtain similar coverage from similar insurers as may be necessary to
continue its business at a cost that would not materially and adversely affect the financial
condition or the earnings, business or operations of the Company and its Subsidiaries, taken as a
whole.



(o) Regulatory Permits. Except as disclosed in the Registration Statement or the SEC
Documents, the Company and its Subsidiaries possess all certificates, authorizations and permits
issued by the appropriate federal, state or foreign regulatory authorities necessary to conduct
their respective businesses as currently conducted, except where the failure to possess such
certificates, authorizations, or permits would not reasonably be expected to have a Material
Adverse Effect, and neither the Company nor any such Subsidiary has received any notice of
proceedings relating to the revocation or modification of any such certificate, authorization or
permit.



(p) Tax Status. Except as disclosed in the Registration Statement or the SEC
Documents, the Company and each of its Subsidiaries has made or filed all federal and state income
and all other material tax returns, reports and declarations required by any jurisdiction to which
it is subject (unless and only to the extent that the Company and each of its Subsidiaries has set
aside on its books provisions reasonably adequate for the payment of all unpaid and unreported
taxes) and has paid all taxes and other governmental assessments and charges that are material in
amount, shown or determined to be due on such returns, reports and declarations, except those being
contested in good faith and has set aside on its books provision reasonably adequate for the
payment of all taxes for periods subsequent to the periods to which such returns, reports or
declarations apply. There are no unpaid taxes in any amount claimed to be due by the taxing
authority of any jurisdiction, except as would not reasonably be expected to have a Material
Adverse Effect, and the officers of the Company know of no basis for any such claim.



(q) Transactions With Affiliates.  Except as disclosed in the Registration
Statement or the SEC Documents, none of the officers or directors of the Company and, to the
knowledge of the Company, none of the employees of the Company is presently a party to any
transaction with the Company or any Subsidiary (other than for services as employees, officers and
directors), including any contract, agreement or other arrangement providing for the furnishing of
services to or by, providing for rental of real or personal property to or from, or otherwise
requiring payments to or from any officer, director or such employee or, to the knowledge of the
Company, any entity in which any officer, director, or any such employee has a substantial interest
or is an officer, director, trustee or partner, in each case in excess of $120,000 other than for
(i) payment of salary or consulting fees for services rendered, (ii) reimbursement for expenses
incurred on behalf of the Company and (iii) other employee benefits, including stock option
agreements under any stock option plan of the Company.



(r) Application of Takeover Protections. The Company and its board of directors have
taken or will take prior to the Commencement Date all necessary action, if any, in order to render
inapplicable any control share acquisition, business combination, poison pill (including any
distribution under a rights agreement) or other similar anti-takeover provision under the
Certificate of Incorporation or the laws of the state of its incorporation which is or could become
applicable to the Investor as a result of the transactions contemplated by this Agreement,
including, without limitation, the Company’s issuance of the Securities and the Investor’s
ownership of the Securities.



(s)  Disclosure.  Except with respect to the material terms and conditions
of the transactions contemplated by the Transaction Documents that will be timely publicly
disclosed by the Company, the Company confirms that neither it nor any other Person acting on its
behalf has provided the Investor or its agents or counsel with any information that it believes
constitutes or might constitute material, non-public information which is not otherwise disclosed
in the Registration Statement or any Prospectus Supplements thereto.   The Company understands and
confirms that the Investor will rely on the foregoing representation in effecting purchases and
sales of securities of the Company.  All of the disclosure furnished by or on behalf of the Company
to the Investor regarding the Company, its business and the transactions contemplated hereby,
including the disclosure schedules to this Agreement, is true and correct in all material respects
and does not contain any untrue statement of a material fact or omit to state any material fact
necessary in order to make the statements made therein, in light of the circumstances under which
they were made, not misleading. The press releases disseminated by the Company during the 12 months
preceding the date of this Agreement taken as a whole do not contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein or necessary in order
to make the statements therein, in light of the circumstances under which they were made and when
made, not misleading.  The Company acknowledges and agrees that the Investor neither makes nor has
made any representations or warranties with respect to the transactions contemplated hereby other
than those specifically set forth in Section 3 hereof.



(t) Foreign Corrupt Practices.  Neither the Company, nor to the knowledge
of the Company, any agent or other Person acting on behalf of the Company, has (i) directly or
indirectly, used any funds for unlawful contributions, gifts, entertainment or other unlawful
expenses related to foreign or domestic political activity, (ii) made any unlawful payment to
foreign or domestic government officials or employees or to any foreign or domestic political
parties or campaigns from corporate funds, (iii) failed to disclose fully any contribution made by
the Company (or made by any Person acting on its behalf of which the Company is aware) which is in
violation of law, or (iv) violated in any material respect any provision of the Foreign Corrupt
Practices Act of 1977, as amended.



(u) Registration Statement. The Company has prepared and filed with the SEC in
accordance with the provisions of the Securities Act the Registration Statement. The Registration
Statement was declared effective by order of the SEC on June 22, 2016. The Registration Statement
is effective pursuant to the Securities Act and available for the issuance of the Securities
thereunder, and the Company has not received any written notice that the SEC has issued or intends
to issue a stop order or other similar order with respect to the Registration Statement or the
Prospectus or that the SEC otherwise has (i) suspended or withdrawn the effectiveness of the
Registration Statement or (ii) issued any order preventing or suspending the use of the Prospectus
or any Prospectus Supplement, in either case, either temporarily or permanently or intends or has
threatened in writing to do so. The “Plan of Distribution” section of the Prospectus permits the
issuance of the Securities hereunder. At the time the Registration Statement and any amendments
thereto became effective, at the date of this Agreement and at each deemed effective date thereof
pursuant to Rule 430B(f)(2) of the Securities Act, the Registration Statement and any amendments
thereto complied and will comply in all material respects with the requirements of the Securities
Act and did not and will not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements therein not
misleading; and the Base Prospectus and any Prospectus Supplement thereto, at the time such Base
Prospectus or such Prospectus Supplement thereto was issued and on the Commencement Date, complied
and will comply in all material respects with the requirements of the Securities Act and did not
and will not contain an untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in light of the circumstances under which they
were made, not misleading; provided that this representation and warranty does not apply to
statements in or omissions from any Prospectus Supplement made in reliance upon and in conformity
with information relating to the Investor furnished to the Company in writing by or on behalf of
the Investor expressly for use therein. The Company meets all of the requirements for the use of a
registration statement on Form S-3 pursuant to the Securities Act for the offering and sale of the
Securities contemplated by this Agreement without reliance on General Instruction I.B.6. of Form
S-3, and the SEC has not notified the Company of any objection to the use of the form of the
Registration Statement pursuant to Rule 401(g)(1) of the Securities Act. The Registration
Statement, as of its effective date, meets the requirements set forth in Rule 415(a)(1)(x) pursuant
to the Securities Act. The Company has not been since March 31, 2016, and currently is not, an
Ineligible Issuer (as defined in Rule 405 of the Securities Act). The Company has not distributed
any offering material in connection with the offering and sale of any of the Securities, and, until
the Investor does not hold any of the Securities, shall not distribute any offering material in
connection with the offering and sale of any of the Securities, to or by the Investor, in each
case, other than the Registration Statement or any amendment thereto, the Prospectus or any
Prospectus Supplement required pursuant to applicable law or the Transaction Documents. The Company
has not made, and agrees that unless it obtains the prior written consent of the Investor it will
not make, an offer relating to the Securities that would constitute a “free writing prospectus” as
defined in Rule 405 under the Securities Act. The Company shall comply with the requirements of
Rules 164 and 433 under the Securities Act applicable to any such free writing prospectus consented
to by the Investor, including in respect of timely filing with the SEC, legending and record
keeping. The offering of the Securities pursuant to this Agreement qualifies for the exemption from
the filing requirements of Rule 5110 of the FINRA afforded by FINRA Rule 5110(b)(7)(C)(i).



(v) DTC Eligibility. The Company, through the Transfer Agent, currently participates
in the DTC Fast Automated Securities Transfer (FAST) Program and the Common Stock can be
transferred electronically to third parties via the DTC Fast Automated Securities Transfer (FAST)
Program.



(w) Sarbanes-Oxley. The Company is in material compliance with all provisions of the
Sarbanes-Oxley Act of 2002, as amended, which are applicable to it as of the date hereof.



(x) Certain Fees. Except as disclosed on Schedule 4(x), no brokerage or
finder’s fees or commissions are or will be payable by the Company to any broker, financial advisor
or consultant, finder, placement agent, investment banker, bank or other Person with respect to the
transactions contemplated by the Transaction Documents. Except as disclosed on Schedule
4(x), the Investor shall have no obligation with respect to any fees or with respect to any
claims made by or on behalf of other Persons for fees of a type contemplated in this Section 4(x)
that may be due in connection with the transactions contemplated by the Transaction Documents.



(y) Investment Company. The Company is not required to be registered as, and
immediately after receipt of payment for the Securities will not be required to be registered as,
an “investment company” within the meaning of the Investment Company Act of 1940, as amended.



(z) Listing and Maintenance Requirements. The Common Stock is registered pursuant to
Section 12(b) of the Exchange Act, and the Company has taken no action designed to, or which to its
knowledge is likely to have the effect of, terminating the registration of the Common Stock
pursuant to the Exchange Act nor has the Company received any notification that the SEC is
currently contemplating terminating such registration. The Company has not, in the twelve (12)
months preceding the date hereof, received any notice from the Principal Market to the effect that
the Company is not in compliance with the listing or maintenance requirements of the Principal
Market. The Company is in compliance with all such listing and maintenance requirements.



(aa) Accountants. The Company’s accountants are set forth in the SEC Documents and,
to the knowledge of the Company, such accountants are an independent registered public accounting
firm as required by the Securities Act.



(bb) No Market Manipulation. The Company has not, and to its knowledge no Person
acting on its behalf has, (i) taken, directly or indirectly, any action designed to cause or to
result in the stabilization or manipulation of the price of any security of the Company to
facilitate the sale or resale of any of the Securities, (ii) sold, bid for, purchased, or, paid any
compensation for soliciting purchases of, any of the Securities, or (iii) paid or agreed to pay to
any Person any compensation for soliciting another to purchase any other securities of the Company.



(cc) Shell Company Status. The Company is not currently, and has not been within the
prior 12 months, an issuer identified in Rule 144(i)(1) under the Securities Act.



5. COVENANTS.



(a) Filing of Current Report and Initial Prospectus Supplement. The Company agrees
that it shall, within the time required under the Exchange Act, file with the SEC a current report
on Form 8-K relating to the transactions contemplated by, and describing the material terms and
conditions of, the Transaction Documents (the “Current Report”). The Company further agrees
that it shall, within the time required under Rule 424(b) under the Securities Act, file with the
SEC the Initial Prospectus Supplement pursuant to Rule 424(b) under the Securities Act specifically
relating to the transactions contemplated by, and describing the material terms and conditions of,
the Transaction Documents, containing information previously omitted at the time of effectiveness
of the Registration Statement in reliance on Rule 430B under the Securities Act, and disclosing all
information relating to the transactions contemplated hereby required to be disclosed in the
Registration Statement and the Prospectus as of the date of the Initial Prospectus Supplement,
including, without limitation, information required to be disclosed in the section captioned “Plan
of Distribution” in the Prospectus. The Investor acknowledges that it will be identified in the
Initial Prospectus Supplement as an underwriter within the meaning of Section 2(a)(11) of the
Securities Act. The Company shall permit the Investor to review and comment upon the Current Report
and the Initial Prospectus Supplement at least two (2) Business Days prior to their filing with the
SEC, the Company shall give due consideration to all such comments, and the Company shall not file
the Current Report or the Initial Prospectus Supplement with the SEC in a form to which the
Investor reasonably objects. The Investor shall use its reasonable best efforts to comment upon the
Current Report and the Initial Prospectus Supplement within one (1) Business Day from the date the
Investor receives the final pre-filing draft version thereof from the Company. The Investor shall
furnish to the Company such information regarding itself, the Securities held by it and the
intended method of distribution thereof, including any arrangement between the Investor and any
other Person relating to the sale or distribution of the Securities, as shall be reasonably
requested by the Company in connection with the preparation and filing of the Current Report and
the Initial Prospectus Supplement, and shall otherwise cooperate with the Company as reasonably
requested by the Company in connection with the preparation and filing of the Current Report and
the Initial Prospectus Supplement with the SEC.



(b) Blue Sky. The Company shall take all such action, if any, as is reasonably
necessary in order to obtain an exemption for or to register or qualify (i) the issuance of the
Commitment Shares and the sale of the Purchase Shares to the Investor under this Agreement and (ii)
any subsequent resale of the Commitment Shares and all Purchase Shares by the Investor, in each
case, under applicable securities or “Blue Sky” laws of the states of the United States in such
states as is reasonably requested by the Investor from time to time, and shall provide evidence of
any such action so taken to the Investor.



(c) Listing/DTC. The Company shall promptly secure the listing of all of the Purchase
Shares and Commitment Shares to be issued to the Investor hereunder on the Principal Market
(subject to official notice of issuance) and upon each other national securities exchange or
automated quotation system, if any, upon which the Common Stock is then listed, and shall use
commercially reasonable efforts to maintain, so long as any shares of Common Stock shall be so
listed, such listing of all such Securities from time to time issuable hereunder. The Company shall
use commercially reasonable efforts to maintain the listing of the Common Stock on the Principal
Market and shall comply in all respects with the Company’s reporting, filing and other obligations
under the bylaws or rules and regulations of the Principal Market. Neither the Company nor any of
its Subsidiaries shall take any action that would reasonably be expected to result in the delisting
or suspension of the Common Stock on the Principal Market. The Company shall promptly, and in no
event later than the following Business Day, provide to the Investor copies of any notices it
receives from the Principal Market regarding the continued eligibility of the Common Stock for
listing on the Principal Market; provided, however, that the Company shall not be required to
provide the Investor copies of any such notice that the Company reasonably believes constitutes
material non-public information and the Company would not be required to publicly disclose such
notice in any report or statement filed with the SEC under the Exchange Act (including on Form 8-K)
or the Securities Act. The Company shall pay all fees and expenses in connection with satisfying
its obligations under this Section 5(c). The Company shall take all action necessary to ensure that
its Common Stock can be transferred electronically as DWAC Shares.



(d) Prohibition of Short Sales and Hedging Transactions. The Investor agrees that
beginning on the date of this Agreement and ending on the date of termination of this Agreement as
provided in Section 11, the Investor and its agents, representatives and affiliates shall not in
any manner whatsoever enter into or effect, directly or indirectly, any (i) “short sale” (as such
term is defined in Rule 200 of Regulation SHO of the Exchange Act) of the Common Stock or (ii)
hedging transaction, which establishes a net short position with respect to the Common Stock.



(e) Issuance of Commitment Shares. In consideration for the Investor’s execution and
delivery of this Agreement, the Company shall cause to be issued to the Investor a total of 309,981
shares of Common Stock (the “Initial Commitment Shares”) immediately upon the execution of
this Agreement and shall deliver to the Transfer Agent the Irrevocable Transfer Agent Instructions
with respect to the issuance of such Initial Commitment Shares. The Company shall cause to be
issued to the Investor up to 154,991 shares of Common Stock (the “Additional Commitment
Shares” and, collectively with the Initial Commitment Shares, the “Commitment Shares”),
as follows: in connection with each purchase of Purchase Shares hereunder, the Company shall issue
to the Investor a number of shares of Common Stock equal to the product of (i) 154,991 and (y) the
Purchase Amount Fraction. The “Purchase Amount Fraction” shall mean a fraction, the
numerator of which is the Purchase Amount purchased by the Investor with respect to such purchase
of Purchase Shares and the denominator of which is Twenty-Five Million Dollars ($25,000,000). The
Additional Commitment Shares shall be equitably adjusted for any reorganization, recapitalization,
non-cash dividend, stock split or other similar transaction. For the avoidance of doubt, (1) all of
the Initial Commitment Shares shall be fully earned as of the date of this Agreement, whether or
not the Commencement shall occur or any Purchase Shares (other than the Initial Purchase Shares)
are purchased by the Investor under this Agreement and irrespective of any subsequent termination
of this Agreement and (2) the Additional Commitment Shares shall be fully earned as of the date of
their issuance to the Investor pursuant to this Agreement, irrespective of any subsequent
termination of this Agreement.



(f) Due Diligence; Non-Public Information. The Investor shall have the right, from
time to time as the Investor may reasonably deem appropriate and upon reasonable advance notice to
the Company, to perform reasonable due diligence on the Company during normal business hours. The
Company and its officers and employees shall provide information and reasonably cooperate with the
Investor in connection with any reasonable request by the Investor related to the Investor’s due
diligence of the Company. Each party hereto agrees not to disclose any Confidential Information of
the other party to any third party and shall not use the Confidential Information for any purpose
other than in connection with, or in furtherance of, the transactions contemplated hereby. Each
party hereto acknowledges that the Confidential Information shall remain the property of the
disclosing party and agrees that it shall take all reasonable measures to protect the secrecy of
any Confidential Information disclosed by the other party. The receiving party may disclose
Confidential Information to the extent such information is required to be disclosed by law,
regulation or order of a court of competent jurisdiction or regulatory authority, provided that the
receiving party shall promptly notify the disclosing party when such requirement to disclose
arises, and shall cooperate with the disclosing party so as to enable the disclosing party to: (i)
seek an appropriate protective order; and (ii) make any applicable claim of confidentiality in
respect of such Confidential Information; and provided, further, that the receiving party shall
disclose Confidential Information only to the extent required by the protective order or other
similar order, if such an order is obtained, and, if no such order is obtained, the receiving party
shall disclose only the minimum amount of such Confidential Information required to be disclosed in
order to comply with the applicable law, regulation or order. In addition, any such Confidential
Information disclosed pursuant to this section shall continue to be deemed Confidential
Information. Notwithstanding anything in this Agreement to the contrary, the Company and the
Investor agree that neither the Company nor any other Person acting on its behalf shall provide the
Investor or its agents or counsel with any information that constitutes or may reasonably be
considered to constitute material, non-public information, unless a simultaneous public
announcement thereof is made by the Company in the manner contemplated by Regulation FD. In the
event of a breach of the foregoing covenant by the Company or any Person acting on its behalf (as
determined in the reasonable good faith judgment of the Investor), in addition to any other remedy
provided herein or in the other Transaction Documents, the Investor shall have the right to make a
public disclosure, in the form of a press release, public advertisement or otherwise, of such
material, non-public information without the prior approval by the Company; provided the Investor
shall have first provided notice to the Company that it believes it has received information that
constitutes material, non-public information, the Company shall have at least 24 hours to publicly
disclose such material, non-public information prior to any such disclosure by the Investor, and
the Company shall have failed to publicly disclose such material, non-public information within
such time period. The Investor shall not have any liability to the Company, any of its
Subsidiaries, or any of their respective directors, officers, employees, stockholders or agents,
for any such disclosure. The Company understands and confirms that the Investor shall be relying on
the foregoing covenants in effecting transactions in securities of the Company.



(g) Purchase Records. The Investor and the Company shall each maintain records showing
the remaining Available Amount at any given time and the dates and Purchase Amounts for each
Regular Purchase and Accelerated Purchase or shall use such other method, reasonably satisfactory
to the Investor and the Company.



(h) Taxes. The Company shall pay any and all transfer, stamp or similar taxes that
may be payable with respect to the issuance and delivery of any shares of Common Stock to the
Investor made under this Agreement.



(i) Effective Registration Statement; Current Prospectus; Securities Law Compliance.
The Company shall use its commercially reasonable efforts to keep the Registration Statement
effective pursuant to Rule 415 promulgated under the Securities Act, and to keep the Registration
Statement and the Prospectus current and available for issuances and sales of all of the Securities
by the Company to the Investor, and for the resale by the Investor, at all times until the earlier
of (i) the date on which the Investor shall have sold all the Securities and no Available Amount
remains under this Agreement and (ii) 180 days following the earlier of termination of this
Agreement and the Maturity Date (the “Registration Period”). Without limiting the
generality of the foregoing, during the Registration Period, the Company shall (a) take all action
necessary to cause the Common Stock to continue to be registered as a class of securities under
Sections 12(b) or 12(g) of the Exchange Act, shall comply with its reporting and filing obligations
under the Exchange Act, and shall not take any action or file any document (whether or not
permitted by the Exchange Act) to terminate or suspend such registration or to terminate or suspend
its reporting and filing obligations under the Exchange Act, and (b) prepare and file with the SEC,
at the Company’s expense, such amendments (including, without limitation, post-effective
amendments) to the Registration Statement and such Prospectus Supplements pursuant to Rule 424(b)
under the Securities Act, in each case, as may be necessary to keep the Registration Statement
effective pursuant to Rule 415 promulgated under the Securities Act, and to keep the Registration
Statement and the Prospectus current and available for issuances and sales of all of the Securities
by the Company to the Investor, and for the resale of all of the Securities by the Investor, at all
times during the Registration Period (it being hereby acknowledged and agreed that the Company
shall prepare and file with the SEC, at the Company’s expense, immediately prior to the third
anniversary of the initial effective date of the Registration Statement (the “Renewal
Date”), a new Registration Statement relating to the Securities, in a form satisfactory to the
Investor and its counsel, and the Company shall use its commercially reasonable efforts to cause
such Registration Statement to be declared effective within 180 days after the Renewal Date unless
the Registration Period has lapsed). The Investor shall furnish to the Company such information
regarding itself, the Securities held by it and the intended method of distribution thereof as
shall be reasonably requested by the Company in connection with the preparation and filing of any
such amendment to the Registration Statement (or new Registration Statement) or any such Prospectus
Supplement, and shall otherwise cooperate with the Company as reasonably requested by the Company
in connection with the preparation and filing of any such amendment to the Registration Statement
(or new Registration Statement) or any such Prospectus Supplement. The Company shall comply with
all applicable federal, state and foreign securities laws in connection with the offer, issuance
and sale of the Securities contemplated by the Transaction Documents. Without limiting the
generality of the foregoing, neither the Company nor any of its officers, directors or affiliates
acting on the Company’s behalf will take, directly or indirectly, any action designed or intended
to stabilize or manipulate the price of any security of the Company, or which would reasonably be
expected to cause or result in, stabilization or manipulation of the price of any security of the
Company.



(j) Stop Orders. The Company shall advise the Investor promptly (but in no event
later than 24 hours) and shall confirm such advice in writing: (i) of the Company’s receipt of
notice of any request by the SEC for amendment of or a supplement to the Registration Statement,
the Prospectus, any Prospectus Supplement or for any additional information with respect thereto;
(ii) of the Company’s receipt of notice of the issuance by the SEC of any stop order suspending the
effectiveness of the Registration Statement or prohibiting or suspending the use of the Prospectus
or any Prospectus Supplement, or of the Company’s receipt of any notification of the suspension of
qualification of the Securities for offering or sale in any jurisdiction or the initiation or
contemplated initiation of any proceeding for such purpose; and (iii) of the Company becoming aware
of the happening of any event, which makes any statement of a material fact made in the
Registration Statement, the Prospectus or any Prospectus Supplement untrue or which requires the
making of any additions to or changes to the statements then made in the Registration Statement,
the Prospectus or any Prospectus Supplement in order to state a material fact required by the
Securities Act to be stated therein or necessary in order to make the statements then made therein
(in the case of the Prospectus or any Prospectus Supplement, in light of the circumstances under
which they were made) not misleading, or of the necessity to amend the Registration Statement or
supplement the Prospectus or any Prospectus Supplement to comply with the Securities Act or any
other law. The Company shall not be required to disclose to the Investor the substance or specific
reasons of any of the events set forth in clauses (i) through (iii) of the immediately preceding
sentence, but rather, shall only be required to disclose that the event has occurred. The Company
shall not deliver to the Investor any Regular Purchase Notice or Accelerated Purchase Notice, and
the Investor shall not be obligated to purchase any shares of Common Stock under this Agreement,
during the continuation or pendency of any of the foregoing events. If at any time the SEC shall
issue any stop order suspending the effectiveness of the Registration Statement or prohibiting or
suspending the use of the Prospectus or any Prospectus Supplement, the Company shall use its
commercially reasonable efforts to obtain the withdrawal of such order at the earliest possible
time. The Company shall furnish to the Investor, without charge, a copy of any correspondence from
the SEC or the staff of the SEC to the Company or its representatives relating to the Registration
Statement or the Prospectus, as the case may be.



(k) Amendments to Registration Statement; Prospectus Supplements. Except as provided
in this Agreement and other than periodic and current reports required to be filed pursuant to the
Exchange Act, the Company shall not file with the SEC any amendment to the Registration Statement
or any supplement to the Base Prospectus that refers to the Investor, the Transaction Documents or
the transactions contemplated thereby (including, without limitation, any Prospectus Supplement
filed in connection with the transactions contemplated by the Transaction Documents), in each case
with respect to which (a) the Investor shall not previously have been advised and afforded the
opportunity to review and comment thereon at least two (2) Business Days prior to filing with the
SEC, as the case may be, (b) the Company shall not have given due consideration to any comments
thereon received from the Investor or its counsel, or (c) the Investor shall reasonably object,
unless the Company reasonably has determined that it is necessary to amend the Registration
Statement or make any supplement to the Prospectus to comply with the Securities Act or any other
applicable law or regulation, in which case the Company shall promptly (but in no event later than
24 hours) so inform the Investor, the Investor shall be provided with a reasonable opportunity to
review and comment upon any disclosure referring to the Investor, the Transaction Documents or the
transactions contemplated thereby, as applicable, and the Company shall expeditiously furnish to
the Investor a copy thereof. In addition, for so long as, in the reasonable opinion of counsel for
the Investor, the Prospectus is required to be delivered in connection with any acquisition or sale
of Securities by the Investor, the Company shall not file any Prospectus Supplement with respect to
the Securities without furnishing to the Investor as many copies of such Prospectus Supplement,
together with the Prospectus, as the Investor may reasonably request.



(l) Prospectus Delivery. The Company consents to the use of the Prospectus (and of
each Prospectus Supplement thereto) in accordance with the provisions of the Securities Act and
with the securities or “blue sky” laws of the jurisdictions in which the Securities may be sold by
the Investor, in connection with the offering and sale of the Securities and for such period of
time thereafter as the Prospectus is required by the Securities Act to be delivered in connection
with sales of the Securities. The Company will make available to the Investor upon request, and
thereafter from time to time will furnish to the Investor, as many copies of the Prospectus (and
each Prospectus Supplement thereto) as the Investor may reasonably request for the purposes
contemplated by the Securities Act within the time during which the Prospectus is required by the
Securities Act to be delivered in connection with sales of the Securities. If during such period of
time any event shall occur that in the reasonable judgment of the Company and its counsel, or in
the reasonable judgment of the Investor and its counsel, is required to be set forth in the
Registration Statement, the Prospectus or any Prospectus Supplement or should be set forth therein
in order to make the statements made therein (in the case of the Prospectus or any Prospectus
Supplement, in light of the circumstances under which they were made) not misleading, or if in the
reasonable judgment of the Company and its counsel, or in the reasonable judgment of the Investor
and its counsel, it is otherwise necessary to amend the Registration Statement or supplement the
Prospectus or any Prospectus Supplement to comply with the Securities Act or any other applicable
law or regulation, the Company shall forthwith prepare and, subject to Section 5(k) above, file
with the SEC an appropriate amendment to the Registration Statement or an appropriate Prospectus
Supplement and in each case shall expeditiously furnish to the Investor, at the Company’s expense,
such amendment to the Registration Statement or such Prospectus Supplement, as applicable, as may
be necessary to reflect any such change or to effect such compliance. The Company shall have no
obligation to separately advise the Investor of, or deliver copies to the Investor of, the SEC
Documents, all of which the Investor shall be deemed to have notice and knowledge of.



(m) Integration. From and after the date of this Agreement, the Company will not, and
will use its commercially reasonable efforts to ensure that no Person acting on its behalf will,
directly or indirectly, make any offers or sales of any security or solicit any offers to buy any
security, under circumstances that would cause this offering of the Securities to be integrated
with other offerings by the Company in a manner that would require stockholder approval pursuant to
the rules of the Principal Market on which any of the securities of the Company are listed or
designated, unless stockholder approval is obtained before the closing of such subsequent
transaction in accordance with the rules of such Principal Market.



(n) Use of Proceeds. The Company will use the net proceeds from the offering as
described in the Prospectus.



(o) Other Transactions. The Company shall not enter into, announce or recommend to its
stockholders any agreement, plan, arrangement or transaction in or of which the terms thereof would
restrict, materially delay, conflict with or impair the ability or right of the Company to perform
its obligations under the Transaction Documents, including, without limitation, the obligation of
the Company to deliver the Purchase Shares and the Commitment Shares to the Investor in accordance
with the terms of the Transaction Documents.



(p) Required Filings Relating to Purchases. To the extent required under the
Securities Act or under interpretations by the SEC thereof, as promptly as practicable after the
close of each of the Company’s fiscal quarters (or on such other dates as required under the
Securities Act or under interpretations by the SEC thereof), the Company shall prepare a Prospectus
Supplement, which will set forth the number of Purchase Shares sold to the Investor during such
quarterly period (or other relevant period), the purchase price for such Purchase Shares and the
net proceeds received by the Company from such sales, and shall file such Prospectus Supplement
with the SEC pursuant to Rule 424(b) under the Securities Act (and within the time periods required
by Rule 424(b) and Rule 430B under the Securities Act). If any such quarterly Prospectus Supplement
is not required to be filed under the Securities Act or under interpretations by the SEC thereof,
the Company shall disclose the information referenced in the immediately preceding sentence in its
annual report on Form 10-K or its quarterly report on Form 10-Q (as applicable) in respect of the
quarterly period that ended immediately before the filing of such report in which sales of Purchase
Shares were made to the Investor under this Agreement, and file such report with the SEC within the
applicable time period required by the Exchange Act. The Company shall not file any Prospectus
Supplement pursuant to this Section 5(p), and shall not file any report containing disclosure
relating to such sales of Purchase Shares, unless a copy of such Prospectus Supplement or
disclosure has been submitted to the Investor a reasonable period of time before the filing and the
Investor has not reasonably objected thereto (it being acknowledged and agreed that the Company
shall not submit any portion of any Form 10-K or Form 10-Q other than the specific disclosure
relating to any sales of Purchase Shares). The Company shall also furnish copies of all such
Prospectus Supplements to each exchange or market in the United States on which sales of the
Purchase Shares may be made as may be required by the rules or regulations of such exchange or
market, if applicable.



(q) No Variable Rate Transactions. From and after the date of this Agreement until
the earlier of (i) the 36-month anniversary of the date of this Agreement (irrespective of any
earlier termination of this Agreement), (ii) the date on which the Company shall have received the
full Available Amount pursuant to this Agreement, and (iii) in the event of early termination of
this Agreement, the date on which the Investor shall have sold all the Securities acquired by the
Investor hereunder, the Company shall be prohibited from effecting or entering into an agreement to
effect any issuance by the Company or any of its Subsidiaries of Common Stock or Common Stock
Equivalents (or a combination of units thereof) involving a Variable Rate Transaction, other than
in connection with an Exempt Issuance. The Investor shall be entitled to obtain injunctive relief
against the Company and its Subsidiaries to preclude any such issuance, which remedy shall be in
addition to any right to collect damages, without the necessity of showing economic loss and
without any bond or other security being required. “Common Stock Equivalents” means any
securities of the Company or its Subsidiaries which entitle the holder thereof to acquire at any
time Common Stock, including, without limitation, any debt, preferred stock, rights, options,
warrants or other instrument that is at any time convertible into or exercisable or exchangeable
for, or otherwise entitles the holder thereof to receive, Common Stock. “Variable Rate
Transaction” means a transaction in which the Company (i) issues or sells any debt or equity
securities that are convertible into, exchangeable or exercisable for, or include the right to
receive additional shares of Common Stock or Common Stock Equivalents either (A) at a conversion
price, exercise price, exchange rate or other price that is based upon and/or varies with the
trading prices of or quotations for the Common Stock at any time after the initial issuance of such
debt or equity securities (including, without limitation, pursuant to any “cashless exercise”
provision), or (B) with a conversion, exercise or exchange price that is subject to being reset at
some future date after the initial issuance of such debt or equity security or upon the occurrence
of specified or contingent events directly or indirectly related to the business of the Company or
the market for the Common Stock (including, without limitation, any “full ratchet” or “weighted
average” anti-dilution provisions), (ii) issues or sells any debt or equity securities, including
without limitation, Common Stock or Common Stock Equivalents, either (A) at a price that is subject
to being reset at some future date after the initial issuance of such debt or equity security or
upon the occurrence of specified or contingent events directly or indirectly related to the
business of the Company or the market for the Common Stock, or (B) that is subject to or contains
any put, call, redemption, buy-back, price-reset or other similar provision or mechanism
(including, without limitation, a “Black-Scholes” put or call right) that provides for the issuance
of additional debt or equity securities of the Company or the payment of cash by the Company, or
(iii) enters into any agreement, including, but not limited to, an “equity line of credit”,
“at-the-market offering” or other continuous offering or similar offering of Common Stock or Common
Stock Equivalents, whereby the Company may sell Common Stock or Common Stock Equivalents at a
future determined price. “Exempt Issuance” means the issuance of (a) Common Stock or
options to employees, officers, directors or vendors of the Company pursuant to any stock or option
plan duly adopted for such purpose, by the Board of Directors or a majority of the members of a
committee of directors established for such purpose, (b) securities upon the exercise or exchange
of or conversion of any Securities issued hereunder and/or other securities exercisable or
exchangeable for or convertible into Common Stock issued and outstanding on the date of this
Agreement, provided that such securities have not been amended since the date of this Agreement to
increase the number of such securities or to decrease the exercise price, exchange price or
conversion price of such securities, (c) securities issued pursuant to acquisitions or strategic
transactions approved by the Board of Directors or a majority of the members of a committee of
directors established for such purpose, which acquisitions or strategic transactions can have a
Variable Rate Transaction component, provided that any such issuance shall only be to a Person (or
to the equity holders of a Person) which is, itself or through its subsidiaries, an operating
company or an asset in a business synergistic with the business of the Company and shall provide to
the Company additional benefits in addition to the investment of funds, but shall not include a
transaction in which the Company is issuing securities primarily for the purpose of raising capital
or to an entity whose primary business is investing in securities, or (d) shares of Common Stock
issued and sold pursuant to (1) the Controlled Equity Offering Sales Agreement, dated February 9,
2016, by and between the Company and Cantor Fitzgerald & Co. and (2) any other “at-the-market
offering” of Common Stock through a registered broker-dealer pursuant to an agreement executed from
and after the date of this Agreement.



6. TRANSFER AGENT INSTRUCTIONS.



On the date of this Agreement, the Company shall issue to the Transfer Agent (and any
subsequent transfer agent) irrevocable instructions, in the form substantially similar to those
used by the Investor in substantially similar transactions, to issue the Purchase Shares and the
Commitment Shares in accordance with the terms of this Agreement (the “Irrevocable Transfer
Agent Instructions”). All Securities to be issued to or for the benefit of the Investor
pursuant to this Agreement shall be issued as DWAC Shares. The Company warrants to the Investor
that no instruction other than the Irrevocable Transfer Agent Instructions referred to in this
Section 6 will be given by the Company to the Transfer Agent with respect to the Securities, and
the Securities shall otherwise be freely transferable on the books and records of the Company.




	 	7.	 	CONDITIONS TO THE COMPANY’S RIGHT TO COMMENCE






SALES OF SHARES OF COMMON STOCK.



The right of the Company hereunder to commence sales of the Purchase Shares on the
Commencement Date is subject to the satisfaction or, where legally permissible, the waiver of each
of the following conditions:



(a) The Investor shall have executed each of the Transaction Documents and delivered the same
to the Company;



(b) No stop order with respect to the Registration Statement shall be pending or threatened by
the SEC;



(c) All federal, state, local and foreign governmental laws, rules and regulations applicable
to the transactions contemplated by the Transaction Documents and necessary for the execution,
delivery and performance of the Transaction Documents and the consummation of the transactions
contemplated thereby in accordance with the terms thereof shall have been complied with, and all
consents, authorizations and orders of, and all filings and registrations with, all federal, state,
local and foreign courts or governmental agencies and all federal, state, local and foreign
regulatory or self-regulatory agencies necessary for the execution, delivery and performance of the
Transaction Documents and the consummation of the transactions contemplated thereby in accordance
with the terms thereof shall have been obtained or made, including, without limitation, in each
case those required prior to the commencement of sales of Purchase Shares under the Securities Act,
the Exchange Act, applicable state securities or “Blue Sky” laws or applicable rules and
regulations of the Principal Market or otherwise required by the SEC, the Principal Market, or any
state securities regulators;



(d) No statute, regulation, order, decree, writ, ruling or injunction shall have been enacted,
entered, promulgated, threatened or endorsed by any federal, state or local court or governmental
authority of competent jurisdiction which prohibits the consummation of or which would materially
modify or delay any of the transactions contemplated by the Transaction Documents;



(e) All Securities to be issued by the Company to the Investor under the Transaction Documents
shall have been approved for listing on the Principal Market in accordance with the applicable
rules and regulations of the Principal Market, subject only to official notice of issuance; and



(f) The representations and warranties of the Investor shall be true and correct in all
material respects (except to the extent that any of such representations and warranties is already
qualified as to materiality in Section 3 above, in which case, such representations and warranties
shall be true and correct without further qualification) as of the date hereof and as of the
Commencement Date as though made at that time.




	 	8.	 	CONDITIONS TO THE INVESTOR’S OBLIGATION TO PURCHASE SHARES OF COMMON STOCK.





The obligation of the Investor to buy Purchase Shares under this Agreement is subject to the
satisfaction or, where legally permissible, the waiver of each of the following conditions on or
prior to the Commencement Date and, once such conditions have been initially satisfied, there shall
not be any ongoing obligation to satisfy such conditions after the Commencement has occurred:



(a) The Company shall have executed each of the Transaction Documents and delivered the same
to the Investor;



(b) The Common Stock shall be listed on the Principal Market and all Securities to be issued
by the Company to the Investor pursuant to this Agreement shall have been approved for listing on
the Principal Market in accordance with the applicable rules and regulations of the Principal
Market, subject only to official notice of issuance;



(c) The Investor shall have received the opinions of the Company’s legal counsel dated as of
the Commencement Date, substantially in the forms agreed to prior to the date of this Agreement by
the Company’s legal counsel and the Investor’s legal counsel;



(d) The representations and warranties of the Company shall be true and correct in all
material respects (except to the extent that any of such representations and warranties is already
qualified as to materiality in Section 4 above, in which case, such representations and warranties
shall be true and correct without further qualification) as of the date when made and as of the
Commencement Date as though made at that time (except for representations and warranties that speak
as of a specific date) and the Company shall have performed, satisfied and complied with the
covenants, agreements and conditions required by the Transaction Documents to be performed,
satisfied or complied with by the Company at or prior to the Commencement Date. The Investor shall
have received a certificate, executed by the CEO, President or CFO of the Company, dated as of the
Commencement Date, to the foregoing effect in the form attached hereto as Exhibit A;



(e) The Board of Directors of the Company shall have adopted resolutions substantially in the
form attached hereto as Exhibit C which shall be in full force and effect without any
amendment or supplement thereto as of the Commencement Date;



(f) As of the Commencement Date, the Company shall have reserved out of its authorized and
unissued Common Stock, (i) solely for the purpose of effecting purchases of Purchase Shares
hereunder, 22,545,726 shares of Common Stock, and (ii) solely for the purpose of effecting the
issuance of Additional Commitment Shares hereunder, 154,991 shares of Common Stock;



(g) The Irrevocable Transfer Agent Instructions shall have been delivered to and acknowledged
in writing by the Company and the Company’s Transfer Agent (or any successor transfer agent), and
the Initial Commitment Shares required to be issued on the date of this Agreement in accordance
with Section 5(e) hereof shall have been issued directly to the Investor electronically as DWAC
Shares;



(h) The Company shall have delivered to the Investor a certificate evidencing the
incorporation and good standing of the Company in the State of Delaware issued by the Secretary of
State of the State of Delaware as of a date within ten (10) Business Days of the Commencement Date;



(i) The Company shall have delivered to the Investor a certified copy of the Certificate of
Incorporation as certified by the Secretary of State of the State of Delaware within ten (10)
Business Days of the Commencement Date;



(j) The Company shall have delivered to the Investor a secretary’s certificate executed by the
Secretary of the Company, dated as of the Commencement Date, in the form attached hereto as
Exhibit B;



(k) The Registration Statement shall continue to be effective and no stop order with respect
to the Registration Statement shall be pending or threatened by the SEC. The Company shall have a
maximum dollar amount certain of Common Stock registered under the Registration Statement which is
sufficient to issue to the Investor not less than (i) the full Available Amount worth of Purchase
Shares plus (ii) all of the Commitment Shares. The Current Report and the Initial Prospectus
Supplement each shall have been filed with the SEC, as required pursuant to Section 5(a), and
copies of the Prospectus shall have been delivered to the Investor in accordance with Section 5(m)
hereof. The Prospectus shall be current and available for issuances and sales of all of the
Securities by the Company to the Investor, and for the resale of all of the Securities by the
Investor. Any other Prospectus Supplements required to have been filed by the Company with the SEC
under the Securities Act at or prior to the Commencement Date shall have been filed with the SEC
within the applicable time periods prescribed for such filings under the Securities Act. All
reports, schedules, registrations, forms, statements, information and other documents required to
have been filed by the Company with the SEC at or prior to the Commencement Date pursuant to the
reporting requirements of the Exchange Act shall have been filed with the SEC within the applicable
time periods prescribed for such filings under the Exchange Act;



(l) No Event of Default (as defined below) has occurred, or any event which, after notice
and/or lapse of time, would become an Event of Default has occurred;



(m) All federal, state and local governmental laws, rules and regulations applicable to the
transactions contemplated by the Transaction Documents and necessary for the execution, delivery
and performance of the Transaction Documents and the consummation of the transactions contemplated
thereby in accordance with the terms thereof shall have been complied with, and all consents,
authorizations and orders of, and all filings and registrations with, all federal, state and local
courts or governmental agencies and all federal, state and local regulatory or self-regulatory
agencies necessary for the execution, delivery and performance of the Transaction Documents and the
consummation of the transactions contemplated thereby in accordance with the terms thereof shall
have been obtained or made, including, without limitation, in each case those required under the
Securities Act, the Exchange Act, applicable state securities or “Blue Sky” laws or applicable
rules and regulations of the Principal Market, or otherwise required by the SEC, the Principal
Market or any state securities regulators;



(n) No statute, regulation, order, decree, writ, ruling or injunction shall have been enacted,
entered, promulgated, threatened or endorsed by any federal, state, local or foreign court or
governmental authority of competent jurisdiction which prohibits the consummation of or which would
materially modify or delay any of the transactions contemplated by the Transaction Documents; and



(o) No action, suit or proceeding before any federal, state, local or foreign arbitrator or
any court or governmental authority of competent jurisdiction shall have been commenced or
threatened, and no inquiry or investigation by any federal, state, local or foreign governmental
authority of competent jurisdiction shall have been commenced or threatened, against the Company,
or any of the officers, directors or affiliates of the Company, seeking to restrain, prevent or
change the transactions contemplated by the Transaction Documents, or seeking material damages in
connection with such transactions.




	 	9.	 	INDEMNIFICATION.





In consideration of the Investor’s execution and delivery of the Transaction Documents and
acquiring the Securities hereunder and in addition to all of the Company’s other obligations under
the Transaction Documents, the Company shall defend, protect, indemnify and hold harmless the
Investor and all of its affiliates, stockholders, officers, directors and employees and any of the
foregoing Person’s agents or other representatives (including, without limitation, those retained
in connection with the transactions contemplated by this Agreement) (collectively, the
“Indemnitees”) from and against any and all actions, causes of action, suits, claims,
losses, costs, penalties, fees, liabilities and damages, and expenses in connection therewith
(irrespective of whether any such Indemnitee is a party to the action for which indemnification
hereunder is sought), and including reasonable attorneys’ fees and disbursements (the
“Indemnified Liabilities”), incurred by any Indemnitee as a result of, or arising out of,
or relating to: (a) any misrepresentation or breach of any representation or warranty made by the
Company in the Transaction Documents or any other certificate, instrument or document contemplated
hereby or thereby, (b) any breach of any covenant, agreement or obligation of the Company contained
in the Transaction Documents or any other certificate, instrument or document contemplated hereby
or thereby, (c) any cause of action, suit or claim brought or made against such Indemnitee and
arising out of or resulting from the execution, delivery, performance or enforcement of the
Transaction Documents or any other certificate, instrument or document contemplated hereby or
thereby, (d) any violation of the Securities Act, the Exchange Act, state securities or “Blue Sky”
laws, or the rules and regulations of the Principal Market in connection with the transactions
contemplated by the Transaction Documents by the Company or any of its Subsidiaries, affiliates,
officers, directors or employees, (e) any untrue statement or alleged untrue statement of a
material fact contained, or incorporated by reference, in the Registration Statement or any
amendment thereto or any omission or alleged omission to state therein, or in any document
incorporated by reference therein, a material fact required to be stated therein or necessary to
make the statements therein not misleading, or (f) any untrue statement or alleged untrue statement
of a material fact contained, or incorporated by reference, in the Prospectus, or any omission or
alleged omission to state therein, or in any document incorporated by reference therein, a material
fact required to be stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading; provided, however, that (I) the indemnity
contained in clause (c) of this Section 9 shall not apply to any Indemnified Liabilities which
directly and primarily result from the fraud, gross negligence or willful misconduct of an
Indemnitee, (II) the indemnity contained in clauses (d), (e) and (f) of this Section 9 shall not
apply to any Indemnified Liabilities to the extent, but only to the extent, arising out of or based
upon any untrue statement or alleged untrue statement or omission or alleged omission made in
reliance upon and in conformity with written information furnished to the Company by or on behalf
of the Investor expressly for use in any Prospectus Supplement (it being hereby acknowledged and
agreed that the written information set forth on Exhibit D attached hereto is the only
written information furnished to the Company by or on behalf of the Investor expressly for use in
the Initial Prospectus Supplement), if the Prospectus was timely made available by the Company to
the Investor pursuant to Section 5(l), (III) the indemnity contained in clauses (d), (e) and (f) of
this Section 9 shall not inure to the benefit of the Investor to the extent such Indemnified
Liabilities are based on a failure of the Investor to deliver or to cause to be delivered the
Prospectus made available by the Company, if such Prospectus was timely made available by the
Company pursuant to Section 5(l), and if delivery of the Prospectus would have cured the defect
giving rise to such Indemnified Liabilities, and (IV) the indemnity in this Section 9 shall not
apply to amounts paid in settlement of any claim if such settlement is effected without the prior
written consent of the Company, which consent shall not be unreasonably withheld, conditioned or
delayed. To the extent that the foregoing undertaking by the Company may be unenforceable for any
reason, the Company shall make the maximum contribution to the payment and satisfaction of each of
the Indemnified Liabilities which is permissible under applicable law. Payment under this
indemnification shall be made within thirty (30) days from the date Investor makes written request
for it. A certificate containing reasonable detail as to the amount of such indemnification
submitted to the Company by Investor shall be conclusive evidence, absent manifest error, of the
amount due from the Company to Investor, provided that the Indemnitee shall undertake to repay any
amounts paid to it hereunder if it is ultimately determined, by a final and non-appealable order of
a court of competent jurisdiction, that the Indemnitee is not entitled to be indemnified against
such Indemnified Liabilities by the Company pursuant to this Agreement. If any action shall be
brought against any Indemnitee in respect of which indemnity may be sought pursuant to this
Agreement, such Indemnitee shall promptly notify the Company in writing, and the Company shall have
the right to assume the defense thereof with counsel of its own choosing reasonably acceptable to
the Indemnitee. Any Indemnitee shall have the right to employ separate counsel in any such action
and participate in the defense thereof, but the fees and expenses of such counsel shall be at the
expense of such Indemnitee, except to the extent that (i) the employment thereof has been
specifically authorized by the Company in writing, (ii) the Company has failed after a reasonable
period of time to assume such defense and to employ counsel or (iii) in such action there is, in
the reasonable opinion of such separate counsel, a material conflict on any material issue between
the position of the Company and the position of such Indemnitee, in which case the Company shall be
responsible for the reasonable fees and expenses of no more than one such separate counsel.



10. EVENTS OF DEFAULT.



An “Event of Default” shall be deemed to have occurred at any time as any of the
following events occurs:



(a) the effectiveness of the Registration Statement registering the Securities lapses for any
reason (including, without limitation, the issuance of a stop order or similar order) or the
Registration Statement or the Prospectus is unavailable for the sale by the Company to the Investor
(or the resale by the Investor) of any or all of the Securities to be issued to the Investor under
the Transaction Documents (including, without limitation, as a result of any failure of the Company
to satisfy all of the requirements for the use of a registration statement on Form S-3 pursuant to
the Securities Act for the offering and sale of the Securities contemplated by this Agreement), and
such lapse or unavailability continues for a period of ten (10) consecutive Business Days or for
more than an aggregate of thirty (30) Business Days in any 365-day period;



(b) the suspension of the Common Stock from trading or the failure of the Common Stock to be
listed on the Principal Market for a period of one (1) Business Day, provided that the Company may
not direct the Investor to purchase any shares of Common Stock during any such suspension;



(c) the delisting of the Common Stock from the NYSE MKT, provided, however, that the Common
Stock is not immediately thereafter trading on the New York Stock Exchange, The NASDAQ Capital
Market, The NASDAQ Global Market, The NASDAQ Global Select Market, the NYSE Arca, the OTC Bulletin
Board or OTC Markets (or nationally recognized successor to any of the foregoing);



(d) the failure for any reason by the Transfer Agent to issue (i) the Additional Commitment
Shares to the Investor within three (3) Business Days after the date on which the Investor is
entitled to receive such Additional Commitment Shares pursuant to Section 5(e) hereof and (ii)
Purchase Shares to the Investor within three (3) Business Days after the applicable Purchase Date
or Accelerated Purchase Date (as applicable) on which the Investor is entitled to receive such
Purchase Shares;



(e) the Company breaches any representation, warranty, covenant or other term or condition
under any Transaction Document if such breach could have a Material Adverse Effect and except, in
the case of a breach of a covenant which is reasonably curable, only if such breach continues for a
period of at least five (5) Business Days;



(f) if any Person commences a proceeding against the Company pursuant to or within the meaning
of any Bankruptcy Law;



(g) if the Company pursuant to or within the meaning of any Bankruptcy Law: (i) commences a
voluntary case, (ii) consents to the entry of an order for relief against it in an involuntary
case, (iii) consents to the appointment of a Custodian of it or for all or substantially all of its
property, or (iv) makes a general assignment for the benefit of its creditors or is generally
unable to pay its debts as the same become due;



(h) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that
(i) is for relief against the Company in an involuntary case, (ii) appoints a Custodian of the
Company or for all or substantially all of its property, or (iii) orders the liquidation of the
Company or any Subsidiary;



(i) if at any time the Company is not eligible to transfer its Common Stock electronically as
DWAC Shares; or



(j) if at any time after the Commencement Date, the Exchange Cap is reached (to the extent the
Exchange Cap is applicable pursuant to Section 2(e) hereof).



In addition to any other rights and remedies under applicable law and this Agreement, so long as an
Event of Default has occurred and is continuing, or if any event which, after notice and/or lapse
of time, would become an Event of Default, has occurred and is continuing, or so long as the
Closing Sale Price is below the Floor Price, the Company shall not deliver to the Investor any
Regular Purchase Notice or Accelerated Purchase Notice, and the Investor shall not purchase any
shares of Common Stock under this Agreement.



11. TERMINATION



This Agreement may be terminated only as follows:



(a) If pursuant to or within the meaning of any Bankruptcy Law, the Company commences a
voluntary case or any Person commences a proceeding against the Company, a Custodian is appointed
for the Company or for all or substantially all of its property, or the Company makes a general
assignment for the benefit of its creditors (any of which would be an Event of Default as described
in Sections 10(f), 10(g) and 10(h) hereof), this Agreement shall automatically terminate without
any liability or payment to the Company (except as set forth below) without further action or
notice by any Person.



(b) In the event that the Commencement shall not have occurred on or before December 31, 2016,
due to the failure to satisfy the conditions set forth in Sections 7 and 8 above with respect to
the Commencement, either the Company or the Investor shall have the option to terminate this
Agreement at the close of business on such date or thereafter without liability of any party to any
other party (except as set forth below); provided, however, that the right to terminate this
Agreement under this Section 11(b) shall not be available to any party if such party is then in
breach of any covenant or agreement contained in this Agreement or any representation or warranty
of such party contained in this Agreement fails to be true and correct such that the conditions set
forth in Section 7(f) or Section 8(d), as applicable, could not then be satisfied.



(c) At any time after the Commencement Date, the Company shall have the option to terminate
this Agreement for any reason or for no reason by delivering notice (a “Company Termination
Notice”) to the Investor electing to terminate this Agreement without any liability whatsoever
of any party to any other party under this Agreement (except as set forth below). The Company
Termination Notice shall not be effective until one (1) Business Day after it has been received by
the Investor.



(d) This Agreement shall automatically terminate on the date that the Company sells and the
Investor purchases the full Available Amount as provided herein, without any action or notice on
the part of any party and without any liability whatsoever of any party to any other party under
this Agreement (except as set forth below).



(e) If for any reason or for no reason the full Available Amount has not been purchased in
accordance with Section 2 of this Agreement by the Maturity Date, this Agreement shall
automatically terminate on the Maturity Date, without any action or notice on the part of any party
and without any liability whatsoever of any party to any other party under this Agreement (except
as set forth below).



Except as set forth in Sections 11(a) (in respect of an Event of Default under Sections 10(f),
10(g) and 10(h)), 11(d) and 11(e), any termination of this Agreement pursuant to this Section 11
shall be effected by written notice from the Company to the Investor, or the Investor to the
Company, as the case may be, setting forth the basis for the termination hereof. The
representations and warranties and covenants of the Company and the Investor contained in Sections
3, 4, 5, and 6 hereof, the indemnification provisions set forth in Section 9 hereof and the
agreements and covenants set forth in Sections 10, 11 and 12, shall survive the Commencement and
any termination of this Agreement. No termination of this Agreement shall (i) affect the Company’s
or the Investor’s rights or obligations under this Agreement with respect to pending Regular
Purchases and Accelerated Purchases and the Company and the Investor shall complete their
respective obligations with respect to any pending Regular Purchases and Accelerated Purchases
under this Agreement or (ii) be deemed to release the Company or the Investor from any liability
for intentional misrepresentation or willful breach of any of the Transaction Documents.



12. MISCELLANEOUS.



(a) Governing Law; Jurisdiction; Jury Trial. The corporate laws of the State of
Delaware shall govern all issues concerning the relative rights of the Company and its
stockholders. All other questions concerning the construction, validity, enforcement and
interpretation of this Agreement and the other Transaction Documents shall be governed by the
internal laws of the State of Illinois, without giving effect to any choice of law or conflict of
law provision or rule (whether of the State of Illinois or any other jurisdictions) that would
cause the application of the laws of any jurisdictions other than the State of Illinois. Each
party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts
sitting in the State of Illinois, County of Cook, for the adjudication of any dispute hereunder or
under the other Transaction Documents or in connection herewith or therewith, or with any
transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not
to assert in any suit, action or proceeding, any claim that it is not personally subject to the
jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient
forum or that the venue of such suit, action or proceeding is improper. Each party hereby
irrevocably waives personal service of process and consents to process being served in any such
suit, action or proceeding by mailing a copy thereof to such party at the address for such notices
to it under this Agreement and agrees that such service shall constitute good and sufficient
service of process and notice thereof. Nothing contained herein shall be deemed to limit in any
way any right to serve process in any manner permitted by law. EACH PARTY HEREBY IRREVOCABLY
WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY
DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION
CONTEMPLATED HEREBY.



(b) Counterparts. This Agreement may be executed in two or more identical
counterparts, all of which shall be considered one and the same agreement and shall become
effective when counterparts have been signed by each party and delivered to the other party;
provided that a facsimile signature or signature delivered by e-mail in a “.pdf” format data file
shall be considered due execution and shall be binding upon the signatory thereto with the same
force and effect as if the signature were an original signature.



(c) Headings. The headings of this Agreement are for convenience of reference and
shall not form part of, or affect the interpretation of, this Agreement.



(d) Severability. If any provision of this Agreement shall be invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability shall not affect the
validity or enforceability of the remainder of this Agreement in that jurisdiction or the validity
or enforceability of any provision of this Agreement in any other jurisdiction.



(e) Entire Agreement; Amendment. This Agreement supersedes all other prior oral or
written agreements between the Investor, the Company, their affiliates and Persons acting on their
behalf with respect to the subject matter hereof, and this Agreement, the other Transaction
Documents and the instruments referenced herein contain the entire understanding of the parties
with respect to the matters covered herein and therein and, except as specifically set forth herein
or therein, neither the Company nor the Investor makes any representation, warranty, covenant or
undertaking with respect to such matters. The Company acknowledges and agrees that is has not
relied on, in any manner whatsoever, any representations or statements, written or oral, other than
as expressly set forth in the Transaction Documents. No provision of this Agreement may be amended
other than by a written instrument signed by both parties hereto.



(f) Notices. Any notices, consents or other communications required or permitted to
be given under the terms of this Agreement must be in writing and will be deemed to have been
delivered: (i) upon receipt when delivered personally; (ii) upon receipt when sent by facsimile or
email (provided confirmation of transmission is mechanically or electronically generated and kept
on file by the sending party); or (iii) one Business Day after deposit with a nationally recognized
overnight delivery service, in each case properly addressed to the party to receive the same. The
addresses for such communications shall be:



	 	 	 
	If to the Company:

	 	

	TransEnterix, Inc.

	 	

	635 Davis Drive, Suite 300

	Morrisville, North Carolina 27560

	Telephone:

Facsimile:

Email:

Attention:

	 	919-765-8400

919-765-8459

jslattery@transenterix.com

Joseph P. Slattery






	 	 	 
	With copies (which shall not constitute notice or service of process) to:

	Ballard Spahr LLP

	 	

	1735 Market Street, 51st Floor

	Philadelphia, Pennsylvania 19103

Telephone:

Facsimile:

Email:

Attention:

	 	

215-864-8631

215-864-8999

mullany@ballardspahr.com

Mary J. Mullany, Esq.







and



	 	 	 
	Joshua Weingard, Chief Legal Officer

	TransEnterix, Inc.

4400 Biscayne Boulevard

Miami, Florida 33137

Telephone:

Facsimile:

Email:

	 	





305-575-4602

919-765-8459

jweingard@transenterix.com






	 	 	 
	If to the Investor:

	 	

	Lincoln Park Capital Fund, LLC

	440 North Wells, Suite 410

	Chicago, IL 60654

Telephone:

Facsimile:

Email:

Attention:

	 	

312-822-9300

312-822-9301

jscheinfeld@lpcfunds.com/jcope@lpcfunds.com

Josh Scheinfeld/Jonathan Cope






	 	 	 
	With a copy (which shall not constitute notice or service of process) to:

	Greenberg Traurig, LLP

The MetLife Building

200 Park Avenue

New York, NY 10166

Telephone:

Facsimile:

Email:

Attention:

	 	







212-801-9200

212-801-6400

marsicoa@gtlaw.com

Anthony J. Marsico, Esq.






	 	 	 
	If to the Transfer Agent:

	Continental Stock & Transfer Company

	17 Battery Place

	 	

	New York, New York 10004

	Telephone:

Attention:

	 	212-845-3249

Margaret Villani






or at such other address and/or facsimile number and/or to the attention of such other Person as
the recipient party has specified by written notice given to each other party three (3) Business
Days prior to the effectiveness of such change. Written confirmation of receipt (A) given by the
recipient of such notice, consent or other communication, (B) mechanically or electronically
generated by the sender’s facsimile machine or email account containing the time, date, and
recipient facsimile number or email address, as applicable, and an image of the first page of such
transmission or (C) provided by a nationally recognized overnight delivery service, shall be
rebuttable evidence of personal service, receipt by facsimile or receipt from a nationally
recognized overnight delivery service in accordance with clause (i), (ii) or (iii) above,
respectively.



(g) Successors and Assigns. This Agreement shall be binding upon and inure to the
benefit of the parties and their respective successors and assigns. The Company shall not assign
this Agreement or any rights or obligations hereunder without the prior written consent of the
Investor, including by merger or consolidation. The Investor may not assign its rights or
obligations under this Agreement.



(h) No Third Party Beneficiaries. This Agreement is intended for the benefit of the
parties hereto and their respective permitted successors and assigns, and is not for the benefit
of, nor may any provision hereof be enforced by, any other Person.



(i) Publicity. The Company shall afford the Investor and its counsel with the
opportunity to review and comment upon, shall consult with the Investor and its counsel on the form
and substance of, and shall give due consideration to all such comments from the Investor or its
counsel on, any press release, SEC filing or any other public disclosure by or on behalf of the
Company relating to the Investor, its purchases hereunder or any aspect of the Transaction
Documents or the transactions contemplated thereby, not less than 24 hours prior to the issuance,
filing or public disclosure thereof. The Investor must be provided with a final version of any such
press release, SEC filing or other public disclosure at least 24 hours prior to any release, filing
or use by the Company thereof; provided, however, that the Company’s obligations pursuant to this
Section 12(i) shall not apply if the form and substance of such press release, SEC filing, or other
public disclosure relating to the Investor, its purchases hereunder or any aspect of the
Transaction Documents or the transactions contemplated thereby previously have been publicly
disclosed by the Company in compliance with this Section 12(i). The Company agrees and acknowledges
that its failure to fully comply with this provision constitutes a Material Adverse Effect.



(j) Further Assurances. Each party shall do and perform, or cause to be done and
performed, all such further acts and things, and shall execute and deliver all such other
agreements, certificates, instruments and documents, as the other party may reasonably request in
order to carry out the intent and accomplish the purposes of this Agreement and the consummation of
the transactions contemplated hereby.



(k) No Financial Advisor, Placement Agent, Broker or Finder. The Company represents
and warrants to the Investor that, except as disclosed in Schedule 4(x), it has not engaged
any financial advisor, placement agent, broker or finder in connection with the transactions
contemplated hereby. The Investor represents and warrants to the Company that it has not engaged
any financial advisor, placement agent, broker or finder in connection with the transactions
contemplated hereby. The Company shall be responsible for the payment of any fees or commissions,
if any, of any financial advisor, placement agent, broker or finder relating to or arising out of
the transactions contemplated hereby. The Company shall pay, and hold the Investor harmless
against, any liability, loss or expense (including, without limitation, attorneys’ fees and out of
pocket expenses) arising in connection with any such claim.



(l) No Strict Construction. The language used in this Agreement will be deemed to be
the language chosen by the parties to express their mutual intent, and no rules of strict
construction will be applied against any party.



(m) Remedies, Other Obligations, Breaches and Injunctive Relief. The Investor’s
remedies provided in this Agreement, including, without limitation, the Investor’s remedies
provided in Section 9, shall be cumulative and in addition to all other remedies available to the
Investor under this Agreement, at law or in equity (including a decree of specific performance
and/or other injunctive relief), no remedy of the Investor contained herein shall be deemed a
waiver of compliance with the provisions giving rise to such remedy and nothing herein shall limit
the Investor’s right to pursue actual damages for any failure by the Company to comply with the
terms of this Agreement. The Company acknowledges that a breach by it of its obligations hereunder
will cause irreparable harm to the Investor and that the remedy at law for any such breach may be
inadequate. The Company therefore agrees that, in the event of any such breach or threatened
breach, the Investor shall be entitled, in addition to all other available remedies, to an
injunction restraining any breach, without the necessity of showing economic loss and without any
bond or other security being required.



(n) Enforcement Costs. In the event of a dispute arising out of or relating to this
Agreement, if a court of competent jurisdiction determines in a final, non-appealable order that a
party has breached this Agreement, then, in addition to any other available remedies, the
non-breaching party shall be entitled to, and the breaching party shall be liable for, the
reasonable legal fees and expenses incurred by the non-breaching party in connection with the
dispute, including any appeals in connection therewith. If this Agreement is placed by the Investor
in the hands of an attorney for enforcement or is enforced by the Investor through any legal
proceeding or an attorney is retained to represent the Investor in any bankruptcy, reorganization,
receivership or other proceedings affecting creditors’ rights and involving a claim under this
Agreement, then the Company shall pay to the Investor, as incurred by the Investor, all reasonable
costs and expenses including reasonable attorneys’ fees incurred in connection therewith, in
addition to all other amounts due hereunder. If this Agreement is placed by the Company in the
hands of an attorney for enforcement or is enforced by the Company through any legal proceeding,
then the Investor shall pay to the Company, as incurred by the Company, all reasonable costs and
expenses including reasonable attorneys’ fees incurred in connection therewith, in addition to all
other amounts due hereunder.



(o) Waivers. No provision of this Agreement may be waived other than in a written
instrument signed by the party against whom enforcement of such waiver is sought. No failure or
delay in the exercise of any power, right or privilege hereunder shall operate as a waiver thereof,
nor shall any single or partial exercise of any such power, right or privilege preclude other or
further exercise thereof or of any other right, power or privilege.



* * * * *




IN WITNESS WHEREOF, the Investor and the Company have caused this Agreement to be duly
executed as of the date first written above.




THE COMPANY:




TRANSENTERIX, INC.



By:  /s/ Joseph P. Slattery

Name: Joseph P. Slattery

Title: Executive Vice President and Chief Financial 

Officer





INVESTOR:




LINCOLN PARK CAPITAL FUND, LLC



BY: LINCOLN PARK CAPITAL, LLC



BY: ALEX NOAH INVESTORS, INC.




By:  /s/ Jonathan Cope

Name: Jonathan Cope

Title: President




	 	 	 	 	 
	 	 	 	 	SCHEDULES
	Schedule 4(a)

Schedule 4(x)

	 	Subsidiaries

Agent Fees
	 	









EXHIBITS




	 	 	 
	Exhibit A

Exhibit B

Exhibit C

Exhibit D

	 	Form of Officer’s Certificate

Form of Secretary’s Certificate

Form of Resolutions of the Board of Directors of the Company

Information About Investor Furnished to the Company






1




EXHIBIT A




FORM OF OFFICER’S CERTIFICATE




This Officer’s Certificate (“Certificate”) is being delivered pursuant to Section 8(d) of that
certain Purchase Agreement dated as of December 16, 2016, (“Purchase Agreement”), by and between
TRANSENTERIX, INC., a Delaware corporation (the “Company”), and LINCOLN PARK CAPITAL FUND, LLC (the
“Investor”). Terms used herein and not otherwise defined shall have the meanings ascribed to them
in the Purchase Agreement.



The undersigned, [      ], [      ] of the Company, hereby certifies, on behalf
of the Company and not in his individual capacity, as follows:



1. I am the [      ] of the Company and make the statements
contained in this Certificate;



2. The representations and warranties of the Company are true and correct in
all material respects (except to the extent that any of such representations and
warranties is already qualified as to materiality in Section 4 of the Purchase
Agreement, in which case, such representations and warranties are true and correct
without further qualification) as of the date when made and as of the Commencement
Date as though made at that time (except for representations and warranties that
speak as of a specific date);



3. The Company has performed, satisfied and complied in all material respects
with covenants, agreements and conditions required by the Transaction Documents to
be performed, satisfied or complied with by the Company at or prior to the
Commencement Date.



4. The Company has not taken any steps, and does not currently expect to take
any steps, to seek protection pursuant to any Bankruptcy Law nor does the Company or
any of its Subsidiaries currently have any knowledge or reason to believe that its
creditors intend to initiate involuntary bankruptcy or insolvency proceedings. The
Company is currently financially solvent and is generally able to pay its debts as
they become due.



IN WITNESS WHEREOF, I have hereunder signed my name on this        day of       .



      



Name:



Title:



The undersigned as [      ] of TransEnterix, Inc., a Delaware corporation, hereby
certifies that [      ] is the duly elected, appointed, qualified and acting
[      ] of TransEnterix, Inc., and that the signature appearing above is his genuine
signature.



      



Name:



Title:



2



EXHIBIT B




FORM OF SECRETARY’S CERTIFICATE




This Secretary’s Certificate (“Certificate”) is being delivered pursuant to Section 8(j) of
that certain Purchase Agreement dated as of December 16, 2016, (“Purchase Agreement”), by and
between TRANSENTERIX, INC., a Delaware corporation (the “Company”) and LINCOLN PARK CAPITAL FUND,
LLC (the “Investor”), pursuant to which the Company may sell to the Investor up to Twenty-Five
Million Dollars ($25,000,000) of the Company’s Common Stock, $0.001 par value (the “Common Stock”).
Terms used herein and not otherwise defined shall have the meanings ascribed to them in the
Purchase Agreement.



The undersigned,       , Secretary of the Company, hereby certifies, on behalf of the
Company and not in his individual capacity, as follows:



1. I am the Secretary of the Company and make the statements contained in this
Secretary’s Certificate.



2. Attached hereto as Exhibit A and Exhibit B are true, correct
and complete copies of the Company’s Bylaws (“Bylaws”) and Certificate of
Incorporation (“Charter”), in each case, as amended through the date hereof, and no
action has been taken by the Company, its directors, officers or stockholders, in
contemplation of the filing of any further amendment relating to or affecting the
Bylaws or Charter.



3. Attached hereto as Exhibit C are true, correct and complete copies
of the resolutions duly adopted by the Board of Directors of the Company on
     , at which a quorum was present and acting throughout. Such
resolutions have not been amended, modified or rescinded and remain in full force
and effect and such resolutions are the only resolutions adopted by the Company’s
Board of Directors, or any committee thereof, or the stockholders of the Company
relating to or affecting (i) the entering into and performance of the Purchase
Agreement, or the issuance, offering and sale of the Purchase Shares and the
Commitment Shares and (ii) and the performance of the Company of its obligation
under the Transaction Documents as contemplated therein.



4. As of the date hereof, the authorized, issued and reserved capital stock of
the Company is as set forth on Exhibit D hereto.



IN WITNESS WHEREOF, I have hereunder signed my name on this        day of       .



      



Secretary



The undersigned as [      ] of TransEnterix, Inc., a Delaware corporation, hereby certifies
that        is the duly elected, appointed, qualified and acting Secretary of TransEnterix, Inc.,
and that the signature appearing above is his genuine signature.



      



Name:



Title:



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EXHIBIT C




FORM OF COMPANY RESOLUTIONS

FOR SIGNING PURCHASE AGREEMENT




WHEREAS, there has been presented to the Board of Directors of the Corporation a draft of the
Purchase Agreement (the “Purchase Agreement”) by and between TransEnterix, Inc., a Delaware
corporation (the “Corporation”), and Lincoln Park Capital Fund, LLC (“Lincoln Park”), providing for
the purchase by Lincoln Park of up to Twenty-Five Million Dollars ($25,000,000) of the
Corporation’s common stock, $0.001 par value per share (the “Common Stock”); and



WHEREAS, after careful consideration of the Purchase Agreement, the documents incident thereto
and other factors deemed relevant by the Board of Directors, the Board of Directors has determined
that it is advisable and in the best interests of the Corporation to engage in the transactions
contemplated by the Purchase Agreement, including, but not limited to, the issuance of up to
464,972 shares of Common Stock to Lincoln Park as a commitment fee upon the signing of the Purchase
Agreement (the “Commitment Shares”) and the sale of shares of Common Stock to Lincoln Park up to
the available amount under the Purchase Agreement (the “Purchase Shares”).



Transaction Documents




NOW, THEREFORE, BE IT RESOLVED, that the transactions described in the Purchase Agreement are
hereby approved and        (the “Authorized Officers”) are
severally authorized to execute and deliver the Purchase Agreement, and any other agreements or
documents contemplated thereby, with such amendments, changes, additions and deletions as the
Authorized Officers may deem to be appropriate and approve on behalf of, the Corporation, such
approval to be conclusively evidenced by the signature of an Authorized Officer thereon; and



FURTHER RESOLVED, that the terms and provisions of the forms of Irrevocable Transfer Agent
Instructions (the “Instructions”) are hereby approved and the Authorized Officers are authorized to
execute and deliver the Instructions on behalf of the Company in accordance with the Purchase
Agreement, with such amendments, changes, additions and deletions as the Authorized Officers may
deem appropriate and approve on behalf of, the Corporation, such approval to be conclusively
evidenced by the signature of an Authorized Officer thereon; and



Execution of Purchase Agreement




FURTHER RESOLVED, that the Corporation be and it hereby is authorized to execute the Purchase
Agreement providing for the purchase of up to Twenty-Five Million Dollars ($25,000,000) of the
Corporation’s common stock; and



Issuance of Common Stock




FURTHER RESOLVED, that the Corporation is hereby authorized to issue to Lincoln Park Capital
Fund, LLC, 309,981 shares of Common Stock as Initial Commitment Shares and that upon issuance of
the Initial Commitment Shares pursuant to the Purchase Agreement the Initial Commitment Shares
shall be duly authorized, validly issued, fully paid and nonassessable with no personal liability
attaching to the ownership thereof; and



FURTHER RESOLVED, that the Corporation is hereby authorized to issue up to 154,991 shares of
Common Stock as Additional Commitment Shares under the Purchase Agreement in accordance with the
terms of the Purchase Agreement and that, upon issuance of the Additional Commitment Shares
pursuant to the Purchase Agreement, the Additional Commitment Shares will be duly authorized,
validly issued, fully paid and nonassessable with no personal liability attaching to the ownership
thereof; and



FURTHER RESOLVED, that the Corporation shall reserve 154,991 shares of Common Stock for
issuance as Additional Commitment Shares under the Purchase Agreement; and



FURTHER RESOLVED, that the Corporation is hereby authorized to issue shares of Common Stock
upon the purchase of Purchase Shares up to the Available Amount under the Purchase Agreement in
accordance with the terms of the Purchase Agreement and that, upon issuance of the Purchase Shares
pursuant to the Purchase Agreement, the Purchase Shares will be duly authorized, validly issued,
fully paid and nonassessable with no personal liability attaching to the ownership thereof; and



FURTHER RESOLVED, that the Corporation shall initially reserve 22,545,726 shares of Common
Stock for issuance as Purchase Shares under the Purchase Agreement.



Approval of Actions




FURTHER RESOLVED, that, without limiting the foregoing, the Authorized Officers are, and each
of them hereby is, authorized and directed to proceed on behalf of the Corporation and to take all
such steps as deemed necessary or appropriate, with the advice and assistance of counsel, to cause
the Corporation to consummate the agreements referred to herein and to perform its obligations
under such agreements; and



FURTHER RESOLVED, that the Authorized Officers be, and each of them hereby is, authorized,
empowered and directed on behalf of and in the name of the Corporation, to take or cause to be
taken all such further actions and to execute and deliver or cause to be executed and delivered all
such further agreements, amendments, documents, certificates, reports, schedules, applications,
notices, letters and undertakings and to incur and pay all such fees and expenses as in their
judgment shall be necessary, proper or desirable to carry into effect the purpose and intent of any
and all of the foregoing resolutions, and that all actions heretofore taken by any officer or
director of the Corporation in connection with the transactions contemplated by the agreements
described herein are hereby approved, ratified and confirmed in all respects.



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EXHIBIT D




Information About The Investor Furnished To The Company By The Investor

Expressly For Use In Connection With The Initial Prospectus Supplement




Information With Respect to Lincoln Park Capital



As of the date of the Purchase Agreement, Lincoln Park Capital Fund, LLC, beneficially owned
309,981 shares of our common stock. Josh Scheinfeld and Jonathan Cope, the Managing Members of
Lincoln Park Capital, LLC, the manager of Lincoln Park Capital Fund, LLC, are deemed to be
beneficial owners of all of the shares of common stock owned by Lincoln Park Capital Fund, LLC.
Messrs. Cope and Scheinfeld have shared voting and investment power over the shares being offered
under the prospectus supplement filed with the SEC in connection with the transactions contemplated
under the Purchase Agreement. Lincoln Park Capital, LLC is not a licensed broker dealer or an
affiliate of a licensed broker dealer.




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